Notes to the financial statements

For the Year ended 31 December 2025

 

1.    Incorporation and principal activities

Country of incorporation

KEFI Gold and Copper PLC (the "Company") was incorporated in United Kingdom as a public limited company on 24 October 2006. Its registered office is at 27/28, Eastcastle Street, London W1W 8DH.The principal place of business is Cyprus.

Principal activities

The principal activities of the Group are:

·      Exploration for mineral deposits of precious and base metals and other minerals that appear capable of commercial exploitation, including topographical, geological, geochemical, and geophysical studies and exploratory drilling.

·      Evaluation of mineral deposits determining the technical feasibility and commercial viability of development, including the determination of the volume and grade of the deposit, examination of extraction methods, infrastructure requirements and market and finance studies.

·      Development of mineral deposits and marketing of the metals produced.

 

2.    Material accounting policies

The principal material accounting policies adopted in the preparation of these financial statements are set out below. These policies have been consistently applied throughout both periods presented in these financial statements unless otherwise stated.

Basis of preparation and consolidation

The Company and the consolidated financial statements have been prepared in accordance with UK adopted international accounting standards in conformity with the requirements of the Companies Act 2006. They comprise the accounts of KEFI Gold and Copper PLC and all its subsidiaries made up to 31 December 2025. The Company and the consolidated financial statements have been prepared under the historical cost convention, except for certain financial assets, which have been measured at

fair value.

Subsidiaries

Subsidiaries are entities controlled by the Group.  The financial statements of subsidiaries have been included in the consolidated financial statements from the date that control commences until the date that control ceases.

An investor controls an investee if, and only if, it has all of the following: (a) power over the investee, (b) exposure or rights to variable returns from its involvement with the investee, and (c) the ability to use its power over the investee to affect the amount of the investor's returns.".

Transactions eliminated on consolidation

Intra-group balances and transactions, and any income and expenses arising from intra-group transactions, are eliminated in preparing the consolidated financial statements.

Going concern

The Company is a holding entity and, as such, its going concern status is dependent on the Group. The going concern assessment for the Company was therefore performed as part of the Group's assessment.

Assessing the Group's ability to continue as a going concern requires significant judgement, particularly in relation to the availability and timing of development capital for the Company's primary objective, the development of the Tulu Kapi Gold Project, and its general working capital needs. Under Company policy, all other activities, including exploration and the advancement of the Saudi Arabia portfolio, are secondary.

As part of this assessment, the Directors have considered funds on hand, funding commitments received, current liabilities, and planned expenditure covering a period to 31 December 2027, which is at least 12 months from the date of approval of these financial statements. The Group has prepared cash flow forecasts, which shows that the Group has sufficient cash and liquidity. The Group applied sensitivities to determine the impact on cash and liquidity. 

The Group recognises that within the going concern consideration period it will need funding for normal running costs and for other committed costs, which include its share of the construction and development costs of the Tulu Kapi mine.

It is important to note that substantial progress has been made by the Group in meeting its financing requirements. African based banks, Eastern and Southern African Trade and Development Bank (TDB) and African Finance Corporation (AFC) have committed to a total project debt package of USD 240 million following recent credit committee approvals and execution of the facilities agreement. Lenders have established conditions precedent to first drawdown which are standard for a financing of this nature, which include lender-led technical, security and completion procedures, and finalisation of the Group's share of funding for the construction and development costs. These conditions precedent are expected to be satisfied within the going concern period, but are not wholly within the control of the Directors.

The Group and the Company rely on committed funding from external lenders, which is not fully guaranteed due to conditions precedent to the first drawdown. Furthermore, inherent uncertainties associated with large civil construction, development, and commissioning projects could mean that actual project costs exceed forecasts during the going concern period. These conditions indicate the existence of a material uncertainty that may cast significant doubt on the Group's and the Company's ability to continue as a going concern and, therefore, the Group and the Company may be unable to realise their assets and discharge their liabilities in the normal course of business.

The Directors remain mindful of the financial markets generally and the recent conflicts in the Middle East. Therefore, the Group has established a diversified and flexible funding structure that includes royalty financing, and a retained standby facility that can be responsive to changing circumstances.

Based on historical experience and current ongoing proactive discussions with stakeholders, the Directors have a reasonable expectation that the conditions precedent will be met, and the requisite funding will be secured. Additionally, the Directors expect that the Group and the Company will be able to continue to raise funds if and when required to meet their objectives and obligations. Accordingly, the financial statements have been prepared on the going concern basis. The financial statements do not include any adjustments that would be necessary if the Group and the Company were unable to continue as a going concern.

Functional and presentation currency

The individual financial statements of each Group entity are measured and presented in the currency of the primary economic environment in which the entity operates. The consolidated financial statements of the Group and the statement of financial position and equity of the Company are in British Pounds ("GBP") which is the functional currency of the Company and the presentation currency for the consolidated financial statements. Functional currency is also determined for each of the Company's subsidiaries, and items included in the financial statements of the subsidiary are measured using that functional currency. GBP is the functional currency of all subsidiaries.

(1)   Foreign currency translation

Foreign currency transactions are translated into the presentational currency using the exchange rates prevailing at the date of the transactions. Gains and losses resulting from the settlement of such transactions and from the translation of monetary assets and liabilities denominated in foreign currencies are recognized in profit or loss in the statement of comprehensive income.

(2)   Foreign operations

On consolidation, the assets and liabilities of the consolidated entity's foreign operations are translated at exchange rates prevailing at the reporting date. Income and expense items are translated at the average exchange rates for the period unless exchange rates fluctuate significantly in which case they are recorded at the actual rate. As all subsidiaries use GBP as their functional currency and the Group's presentation currency is also GBP, no foreign currency translation differences arise on consolidation.

Revenue recognition

The Group had no revenue during the year ended 31 December 2025 (2024: Nil).

Property plant and equipment

Property plant and equipment are stated at their cost of acquisition at the date of acquisition, being the fair value of the consideration provided plus incidental costs directly attributable to the acquisition less depreciation.

Depreciation is calculated using the straight-line method to write off the cost of each asset to their residual values over their estimated useful life.

The annual depreciation rates used are as follows:

Furniture, fixtures and office equipment	25%
Motor vehicles Plant and equipment	25% 25%

Intangible Assets

Cost of licences to mines are capitalised as intangible assets which relate to projects that are at the pre-development stage. No amortisation charge is recognised in respect of these intangible assets. Once the Group starts production these intangible assets relating to the license to mine will be depreciated over life of mine.

Finance costs

Interest expense and other borrowing costs are charged to the statement of comprehensive income as incurred and is recognised using the effective interest method.

Tax

The tax payable is based on taxable profit for the period. Taxable profit differs from net profit as reported in the statement of comprehensive income because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. Tax is payable in the relevant jurisdiction at the rates described in Note 10.

Deferred tax is the tax expected to be payable or recoverable on differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit and is accounted for using the statement of financial position liability method. 

Deferred tax liabilities are generally recognized for all taxable differences and deferred tax assets are recognized to the extent that taxable profits will be available against which deductible temporary differences can be utilized. The amount of deferred tax is based on the expected manner of realisation or settlement of the carrying amounts of assets and liabilities, using tax rates that have been enacted or substantively enacted at the reporting date.

Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off deferred tax assets against deferred tax liabilities and when the deferred taxes relate to the same fiscal authority.

Investments

Investments in subsidiary companies are stated at cost less provision for impairment in value, which is recognized as an expense in the period in which the impairment is identified, in the Company accounts.

Financial Assets at Fair Value Through Profit or Loss

Investments in equity instruments that are not accounted for as subsidiaries, joint arrangements or associates are classified at initial recognition as financial assets at fair value through profit or loss (FVTPL) in accordance with IFRS 9 Financial Instruments, unless an irrevocable election is made to designate them at fair value through other comprehensive income (FVOCI). No such election has been made in respect of the investment described in this note.

Financial assets at FVTPL are initially recognised at fair value. Transaction costs are expensed immediately in profit or loss. At each subsequent reporting date, the investment is remeasured to its fair value, with all changes recognised immediately in profit or loss under the heading 'Fair value gain/(loss) on investments'. Fair value is determined using the valuation techniques described in Note 14.2.

No element of the fair value movement is recognised in other comprehensive income.

Exploration costs

The Group has adopted the provisions of IFRS 6 "Exploration for and Evaluation of Mineral Resources". The company applies IFRS 6 until the project financing is secured. Once financing is secured the project moves to the development stage.

Exploration and evaluation expenditure, including acquisition costs of licences, in respect of each identifiable area of interest is expensed to the statement of comprehensive income as incurred, until the point at which development of a mineral deposit is considered economically viable and the formal definitive feasibility study is completed. At this point costs incurred are capitalised under IFRS 6 because these costs are necessary to bring the resource to commercial production.

Exploration expenditures typically include costs associated with prospecting, sampling, mapping, diamond drilling and other work involved in searching for ore. Evaluation expenditures are the costs incurred to establish the technical and commercial viability of developing mineral deposits identified through exploration activities. Evaluation expenditures include the cost of directly attributable employee costs and economic evaluations to determine whether development of the mineralized material is commercially justified, including definitive feasibility and final feasibility studies.

Impairment reviews for deferred exploration and evaluation expenditure are carried out on a project-by-project basis, with each project representing a potential single cash generating unit. An impairment review is undertaken when indicators of impairment arise such as: (i) unexpected geological occurrences that render the resource uneconomic; (ii) title to the asset is compromised; (iii) variations in mineral prices that render the project uneconomic; (iv) substantive expenditure on further exploration and evaluation of mineral resources is neither budgeted nor planned; and (v) the period for which the Group has the right to explore has expired and is not expected to be renewed.

On commencement of development, Exploration and evaluation expenditure are reclassified to development assets, following assessment for any impairment.

Development expenditure

Once the Board decides that it intends to develop a project, development expenditure is capitalized as incurred, but only where it meets criteria for recognition as an intangible under IAS 38 or a tangible asset under IAS 16 and then amortized over the estimated useful life of the area according to the rate of depletion of the economically recoverable reserves or over the estimated useful life of the mine, if shorter.

Share based compensation benefits

IFRS 2 "Share based Payment" requires the recognition of equity settled share-based payments at fair value at the date of grant and the recognition of liabilities for cash settled share-based payments at the current fair value at each statement of financial position date. The total amount expensed is recognized over the vesting period, which is the period over which performance conditions are to be satisfied. The fair value is measured using the Black Scholes pricing model.  The inputs used in the model are based on management's best estimate, including consideration of the effects of non-transferability, exercise restrictions and behavioural considerations.

Where the Group issues equity instruments to persons other than employees, the statement of comprehensive income is charged with the fair value of goods and services received.

Warrants

Warrants issued are recognised at fair value at the date of grant. The charge is expensed on a straight-line basis over the vesting period. The fair value is measured using the Trinomial Model. Where warrants are considered to represent a transaction cost attributable to a share placement, the fair value is recorded in the warrant reserve and deducted from the share premium.

Financial instruments

Non-derivative financial assets

The Group initially recognises loans and receivables on the date that they are originated.  All other financial assets are recognised initially on the trade date, which is the date that the Group becomes a party to the contractual provisions of the instrument.

The Group derecognises a financial asset when the contractual rights to the cash flows from the asset expire, or it transfers the rights to receive the contractual cash flows in a transaction in which substantially all the risks and rewards of ownership of the financial asset are transferred.  Any interest in such transferred financial assets that is created or retained by the Group is recognised as a separate asset or liability.

Financial assets and liabilities are offset, and the net amount presented in the statement of financial position when, and only when, the Group has a legal right to offset the amounts and intends either to settle on a net basis or to realise the asset and settle the liability simultaneously.

Non-derivative financial assets

The Group classifies its financial assets into one of the categories discussed below, depending on the purpose for which the asset was acquired.

Amortised cost: These are financial assets where the objective is to hold these assets in order to collect contractual cash flows and the contractual cash flows are solely payments of principal and interest. They are initially recognised at fair value plus transaction costs that are directly attributable to their acquisition or issue and are subsequently carried at amortised cost using the effective interest rate method, less provision for impairment. Trade and other receivables, as well as cash are classified as amortised cost.

Impairment of financial assets: Financial assets at amortised cost consist of trade receivables, loans, cash and cash equivalents and debt instruments. Impairment losses are assessed using the forward-looking Expected Credit Loss (ECL) approach. Trade receivable loss allowances are measured at an amount equal to lifetime ECL's. Loss allowances are deducted from the gross carrying amount of the assets

Cash and cash equivalents

Cash and cash equivalents comprise cash balances, and call deposits with maturities of three months or less from the acquisition date that are subject to an insignificant risk of changes in their fair value and are used by the Group in the management of its short-term commitments.

Non-derivative financial liabilities

The Group initially recognises debt securities issued and subordinated liabilities on the date that they are originated.  All other financial liabilities are recognised initially on the trade date, which is the date that the Group becomes a party to the contractual provisions of the instrument.

The Group derecognises a financial liability when its contractual obligations are discharged, cancelled or expire.

The Group classifies non-derivative financial liabilities as other financial liabilities.  Such financial liabilities are recognised initially at fair value less any directly attributable transaction costs.  After initial recognition, these financial liabilities are measured at amortised cost using the effective interest method.

Other financial liabilities comprise trade and other payables and borrowings.

New standards and interpretations applied

The following new standards and interpretations became effective on 1 January 2025 and have been adopted by the Group.

 

New Standards, Interpretations and Amendments Adopted			Effective period commencing on or after
Amendments to IAS 21		IAS 21 The Effects of Changes in Foreign Exchange Rates: Lack of Exchangeability (Amendments)	01 January 2025
The adoption of these amendments had no impact on the consolidated financial statements of the Group and Company
New Standards, Interpretations and Amendments Not Yet Effective			Effective period commencing on or after
Amendments to IFRS 9 Financial Instruments and IFRS 7		Amendments to the Classification and Measurement of Financial Instruments	01 January 2026
Amendments to IFRS 9 and IFRS 7		Contracts Referencing Nature-dependent Electricity	01 January 2026
Annual Improvements to IFRS Accounting Standards - Volume 11		Annual Improvements to IFRS Accounting Standards - Volume 11 (Amendments to IFRS 1, IFRS 7, IFRS 9, IFRS 10 and IAS 7)	01 January 2026
New IFRS18	1	IFRS 18 Presentation and Disclosure in Financial Statements	01 January 2027
New IFRS19	²	IFRS 19 Subsidiaries without Public Accountability: Disclosure	01 January 2027
The Group and Company do not currently apply any available practical expedients and are assessing the impact of these standards and amendments on the consolidated and individual financial statements

 

New standards, amendments and interpretations that are not yet effective and have not been early adopted.

·      Revisions to the Conceptual Framework for Financial Reporting.

The principal material accounting policies adopted are set out above.

There are several standards, amendments to standards, and interpretations which have been issued by the IASB that are effective in future accounting periods that the Group has decided not to adopt early.

The Group is currently assessing the impact of these new accounting standards and amendments.

¹IFRS 18 Presentation and Disclosure in Financial Statements, which was issued by the IASB in April 2024 supersedes IAS 1 and will result in major consequential amendments to IFRS Accounting Standards including IAS 8 Basis of Preparation of Financial Statements (renamed from Accounting Policies, Changes in Accounting Estimates and Errors). Even though IFRS 18 will not have any effect on the recognition and measurement of items in the consolidated financial statements, it is expected to have a significant effect on the presentation and disclosure of certain items. These changes include categorisation and sub-totals in the statement of profit or loss, aggregation/disaggregation and labelling of information, and disclosure of management-defined performance measures. 

²The Group does not expect to be eligible to apply IFRS 19.

The Group does not expect any other standards issued by the IASB, but not yet effective, to have a material impact on the group.

 

3.    Prior Period Adjustment - Reclassification of Investment in Gold & Minerals Co. Limited (IAS 8)

 

Nature of the Reassessment

In preparing the financial statements for the year ended 31 December 2025, management reassessed the contractual rights arising under the shareholders' agreement, and concluded that the Group's equity interest in Gold & Minerals Co. Limited ("GMCO") does not meet the criteria for classification as an associate under IAS 28 Investments in Associates and Joint Ventures. Accordingly, the investment has been reclassified as a financial asset measured at fair value through profit or loss (FVTPL) under IFRS 9 Financial Instruments. The comparative figures for the year ended 31 December 2024 have been corrected and restated in accordance with IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors. The comparative figures for the year ended 31 December 2023 remain unaffected.

Reason for the Adjustment

GMCO is a private, unquoted company incorporated in the Kingdom of Saudi Arabia, engaged in gold and base metals exploration. It was established as a joint venture between ARTAR (Abdul Rahman Saad Al-Rashid & Sons Company Limited) and the Company in May 2009.

On 31 January 2024, ARTAR made a capital contribution into GMCO in which KEFI elected not to participate, reducing KEFI's shareholding to less than 25%. The dilution of the Company's shareholding to below 25% resulted in the activation of certain contractual rights of the majority shareholder. Having regard to the terms of the shareholder agreement, Management concluded that the Company no longer exercises significant influence over GMCO within the meaning of IAS 28 with effect from that date.

Immediately prior to 31 January 2024, the carrying value of the Group's investment in GMCO under the equity method was £nil.

Accordingly, as at 31 December 2024:

(a)  the equity method of accounting under IAS 28 was not applied; and

(b)  the investment was reclassified as a financial asset at fair value through profit or loss ("FVTPL") in accordance with IFRS 9.

The fair value of the investment as at 31 December 2024 was determined using the market approach described in Note 14.2.1. The resulting remeasurement gain of £6.6 million was recognised in the restated FY2024 consolidated income statement.

 

Financial Impact - Effect on FY2024 Comparative Figures

The tables below show the effect on the FY2024 comparative income statement and balance sheet. The restatement is required because the prior period financial statements did not correctly reflect the contractual rights that existed under the amended shareholders' agreement. All adjustments were non-cash. As a result, the restatement only reclassified amounts within the cash generated from operations section, without affecting the total net cash generated from operating, investing, or financing activities for the comparative period.

 

(a)  Effect on FY2024 Comparative Income Statement

	As Previously Stated £'000	Adjustment £'000	Restated £'000
Share of loss from jointly controlled entity	(3,650)	3,259	(391)
Reversal / (impairment) of jointly controlled entity	217	3,068	3,285
Operating loss	(9,960)	6,327	(3,633)
Gain on dilution of joint venture	6,813	(5,981)	832
Fair value gain on GMCO investment	-	6,086	6,086
(Loss)/Profit before taxation	(5,226)	6,432	1,206
(Loss)/Profit for the year	(5,226)	6,432	1,206
Basic and diluted (loss)/earnings per share (pence) [Note 11]	(0.11)	0.13	0.02

Note: Under Cyprus tax legislation, gains or losses arising from the fair value remeasurement or disposal of qualifying securities are exempt from taxation. Accordingly, the fair value gain represents a permanent tax difference, and no deferred tax has been recognised in respect of this investment.

(b)  Effect on FY2024 Comparative Balance Sheet

Consolidated	As Previously Stated £'000	Adjustment £'000	Restated £'000
Investment in associate	-	-	-
Financial Asset at FVTPL	-	6,432	6,432
Total non-current assets	38,516	6,432	44,948
Total assets	39,099	6,432	45,531
Accumulated losses	(60,039)	6,432	(53,607)
Total equity	32,645	6,432	39,077
Total equity and liabilities	39,099	6,432	45,531

The net impact of the restatement on accumulated losses at 1 January 2024 (the beginning of the comparative period) is £nil. The restatement event occurred within the comparative period. Accordingly, the restatement has no effect on the consolidated balance sheet as at 1 January 2024 and the presentation of a third balance sheet is not required.

The year ended 31 December 2025 is the first full year in which GMCO is accounted for as a financial asset at FVTPL throughout. The 2025 income statement and balance sheet are presented on that basis. The net fair value movement in the year was a loss of £533K, recognised in full in profit or loss (see Level 3 reconciliation Note 14.2.5).

 

(c)  Effect on FY2024 Comparative Balance Sheet

Company	As Previously Stated £'000	Adjustment £'000	Restated £'000
Investment in associate	-	-	-
Financial Asset at FVTPL	-	6,432	6,432
Total non-current assets	31,404	6,432	37,836
Total assets	31,631	6,432	38,063
Accumulated losses	(64,847)	6,432	(58,415)
Total equity	25,932	6,432	32,364
Total equity and liabilities	31,631	6,432	38,063

The net impact of the restatement on accumulated losses at 1 January 2024 (the beginning of the comparative period) is £nil. The restatement event occurred within the comparative period. Accordingly, the restatement has no effect on the consolidated balance sheet as at 1 January 2024 and the presentation of a third balance sheet is not required.

The year ended 31 December 2025 is the first full year in which GMCO is accounted for as a financial asset at FVTPL throughout. The 2025 income statement and balance sheet are presented on that basis. The net fair value movement in the year was a loss of £533K, recognised in full in profit or loss (see Level 3 reconciliation Note 14.2.5).

 

4.    Financial risk management

Cash and cash equivalents

For the purposes of the cash flow statement, cash and cash equivalents comprise cash at bank and in hand with an original maturity date of less than three months. To mitigate its inherent exposure to credit risk, the Group maintains policies to limit the concentration of credit risk and to ensure the liquidity of available funds. The Group invests its cash and cash equivalents in rated financial institutions, primarily within the United Kingdom and other investment-grade countries (rated BBB- or higher by S&P). The Group does not have a significant concentration of credit risk arising from its holdings of cash and cash equivalents.

Financial risk factors

The Group is exposed to market risk (interest rate risk and currency risk), liquidity risk and capital risk management arising from the financial instruments it holds. The risk management policies employed by the Group to manage these risks are discussed below:

Credit risk

Credit risk is the risk of financial loss to the Group if a customer or counterparty to a financial instrument fails to meet its contractual obligations.  The Group does not consider this risk to be significant.

The Company has borrowings outstanding from its subsidiaries, the ultimate realisation of which depends on the successful exploration and realization of the Group's intangible exploration assets. This in turn is subject to the availability of financing to maintain the ongoing operations of the business. The Group manages its financial risk to ensure sufficient liquidity is available to meet foreseeable needs and to invest cash assets safely and profitably.

Market risk - Interest rate risk

Interest rate risk is the risk that the value of financial instruments will fluctuate due to changes in market interest rates. The Group's operating cash flows are substantially independent of changes in market interest rates as the interest rates on cash balances are very low at this time. Borrowings issued at variable rates expose the Group to cash flow interest rate risk. Borrowings issued at fixed rates expose the Group to fair value interest rate risk. The Group's management monitors the interest rate fluctuations on a continuous basis and acts accordingly.

At the reporting date the interest rate profile of interest-bearing financial instruments was:

	2025		2024
	£'000		£'000
Variable rate instruments
Financial assets	8,772		185

 

Sensitivity analysis

An increase of 100 basis points in interest rates over the year would have increased equity and profit or loss by the amounts shown below. This analysis assumes that all other variables, in particular foreign currency rates, remain constant. Given current interest rate levels, a decrease of 25 basis points has been considered, with the impact on profit and equity shown below. 

	Equity	Profit or Loss		Equity	Profit or Loss
	2025	2025		2024	2024
	£'000	£'000		£'000	£'000
Variable rate instruments
Financial assets - increase of 100 basis points	88	88		2	2
Financial assets - decrease of 25 basis points	(22)	(22)		(0.5)	(0.5)

 

Currency risk

Currency risk is the risk that the value of financial instruments will fluctuate due to changes in foreign exchange rates. Currency risk arises when future commercial transactions and recognized assets and liabilities are denominated in a currency that is not the functional currency of the entity.

The Group is exposed to foreign exchange risk arising from various currency exposures primarily with respect to the Australian Dollar, Euro, US Dollar, Ethiopian Birr and Saudi Arabian Riyal. Since 1986 the Saudi Arabian Riyal has been pegged to the US Dollar, it is fixed at USD/SAR 3.75. The Group's management monitors the exchange rate fluctuations on a continuous basis and acts accordingly.

The carrying amounts of the Group's foreign currency denominated monetary assets and monetary liabilities at the reporting date are as follows;

 

	Liabilities	Assets		Liabilities	Assets
	2025	2025		2024	2024
	£'000	£'000		£'000	£'000
Australian Dollar	118	-		102	-
Euro	334	41		400	4
US Dollar	3,008	4,571		1,036	2
Ethiopian Birr	1,108	1,593		736	357

 

Sensitivity analysis continued

A 10% strengthening of the British Pound against the following currencies at 31 December 2025 would have increased/(decreased) equity and profit or loss by the amounts shown in the table below. This analysis assumes that all other variables, in particular interest rates, remain constant. For a 10% weakening of the British Pound against the relevant currency, there would be an equal and opposite impact on the profit or loss and equity.

	Equity	Profit or Loss		Equity	Profit or Loss
	2025	2025		2024	2024
	£'000	£'000		£'000	£'000
Australian Dollar	12	12		10	10
Euro	29	29		40	40
US Dollar	(156)	(156)		103	103
Ethiopian Birr	(49)	(49)		38	38

 

 

Liquidity risk

The Group and Companies raise funds as required based on projected expenditure for the next 6 months, depending on prevailing factors. Funds are generally raised on AIM from eligible investors and also from short term providers in the form of bridging finance. The success of capital raisings depends on various factors, including investor sentiment in the equities and metals markets, the broader macroeconomic environment, and other external conditions. When raising funds, the Group evaluates the relative costs and benefits of equity versus alternative financing options. Capital is then allocated to projects based on forecasted expenditure requirement

The carrying amount in the liquidity table below is below the contractual cash flow in 2024 because these short-term loans include interest payable until the repayment date. If the loan is not repaid on the repayment date, an additional interest of 2.5% per week will be incurred.

 

	Carrying Amount	Contractual Cash flows	Less than 1 year	Between 1-5 year	More than 5 years
	£'000	£'000	£'000	£'000	£'000
The Group
31-Dec-25
Trade and other payables	6,980	6,980	6,980	-	-
Loans & Borrowings and Interest	175	175	175	-	-
	7,155	7,155	7,155	-	-
31-Dec-24
Trade and other payables	5,715	5,715	5,715	-	-
Loans & Borrowings and Interest	739	739	739	-	-
	6,454	6,454	6,454	-	-
The Company
31-Dec-25
Trade and other payables	6,046	6,046	6,046	-	-
Loans & Borrowings and Interest	-	-	-	-	-
	6,046	6,046	6,046	-	-
31-Dec-24
Trade and other payables	5,174	5,174	5,174	-	-
Loans & Borrowings and Interest	525	525	525	-	-
	5,699	5,699	5,699	-	-

 

Capital risk management

The Group's objectives when managing capital are to safeguard the Group's ability to continue as a going concern to provide returns for shareholders and benefit other stakeholders and to maintain an optimal capital structure to reduce the costs of capital. This is done through the close monitoring of cash flows.

The capital structure of the Group consists of cash and cash equivalents of £8,772,000 (2024: £185,000) and equity attributable to equity of the parent, comprising issued capital and deferred shares of £34,069,106 (2024: £30,375,000), other reserves of £83,099,000, (2024: £60,404,000) and accumulated losses of £62,382,000 (2024: £53,607,000). The Group has no long-term debt facilities.

Fair value estimation

The Group has certain financial assets and liabilities that are held at fair value. The fair value hierarchy establishes three levels to classify the inputs to valuation techniques to measure fair value:

Classification of financial assets and liabilities

Level 1 - quoted prices (unadjusted) in active markets for identical assets or liabilities;

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

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

The Group's investment in Gold & Minerals Co. Limited ("GMCO") is classified as a financial asset measured at fair value through profit or loss under IFRS 9 and is categorised as Level 3 in the fair value hierarchy at all measurement dates. The valuation technique and significant unobservable inputs applied are described in Note 14.2.

 

The fair value of trade and other receivables is estimated as the present value of future cash flows discounted at the market rate of interest at the reporting date. For receivables and payables with a remaining life of less than one year, the notional amount is deemed to reflect fair value. All other receivables and payables are, where material, discounted to determine the fair value.

Differences arising between the carrying and fair value are considered not significant and no-adjustment is made in these accounts. The carrying and fair values of intercompany balances are the same as if they are repayable on demand. So the amortised cost is approximate to the fair value.

The fair value of the GMCO investment is determined using the market approach, applying an enterprise value per gold-equivalent resource ounce (EV/oz Au-eq) multiple derived from comparable companies, adjusted for a discount for lack of control (DLOC). All inputs to this valuation are unobservable and accordingly the investment is classified as Level 3. There were no transfers between levels during FY2025 or FY2024.

 

The fair values of the Group's loans and other borrowings are considered equal to the book value as the effect of discounting on these financial instruments is not considered to be material. These are classified as Level 2 in the fair value hierarchy.

 

As at each of December 31, 2024, and December 31, 2025, the levels in the fair value hierarchy into which the Group's financial assets and liabilities measured and recognized in the statement of financial position at fair value are categorized are as follows:

Fair Value Hierarchy

	Carrying amounts				Fair values				Level
	2025		2024		2025		2024
Financial assets	£'000		£'000		£'000		£'000
Measured at fair value through profit or loss (FVTPL)
Cash and cash equivalents (Note 16)	8,772		185		8,772		185		1
Investment in GMCO (Note 14.2)	5,955		6,432		5,955		6,432		3
Carried at amortised cost - fair value approximates carrying amount
Trade and other receivables (Note 15)	5,265		398		5,265		398		2
Financial liabilities
Trade and other payables (Note 20)	6,980		5,715		6,980		5,715		2
Loans and borrowings (Note 22)	175		739		175		739		2

 

5.   Use and revision of accounting estimates and judgements

The preparation of the financial report requires the making of estimations and assumptions that affect the recognized amounts of assets, liabilities, revenues and expenses and the disclosure of contingent liabilities. The estimates and associated assumptions are based on historical experience and various other factors that are believed to be reasonable under the circumstances, the results of which form the basis of making the judgments about carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates. 

Accounting Judgement:

Going concern

The going concern presumption depends principally on securing funding to develop the Tulu Kapi gold mining project as an economically viable mineral deposit, and the availability of subsequent funding to extract the resource, or alternatively the availability of funding to extend the Company's and Group's exploration activities (Note 2).

 

Capitalisation of exploration and evaluation costs

The directors consider that the project in its Licence areas in Saudi Arabia has not yet met the criteria for capitalization. These criteria include, among other things, the development of feasibility studies to provide confidence that mineral deposits identified are economically viable. Capitalized Exploration & Evaluation costs for the Group's project in Ethiopia have been recognized on acquisition, and have continued to be capitalised since that date, in accordance with IFRS 6. The technical feasibility of the project has been confirmed, and once the financing is secure the related assets will be reclassified as development costs in line with above.

Shareholding in GMCO

The classification of the Group's investment in Gold and Minerals Company Limited ("GMCO") as a financial asset measured at fair value through profit or loss under IFRS 9 requires significant judgement.

 

Following a reassessment of the contractual rights under the shareholders' agreement, including the dilution of KEFI's shareholding below 25% on 31 January 2024 and noting ARTAR's unilateral right to require transfer of the Group's entire interest at fair value, management concluded that the Group ceased to have significant influence over GMCO for the purposes of IAS 28 from that date.

 

The investment is therefore accounted for as a financial asset at fair value through profit or loss. As GMCO is an unquoted investment, fair value is determined using valuation techniques based on market inputs, including comparable market transactions and implied value per resource ounce, where applicable. The selection of valuation methodology and underlying assumptions requires management judgement.

 

Further details of valuation techniques and key inputs are disclosed in Note 14.2.

Impairment review of asset carrying values (Note 13)

Determining whether intangible exploration and evaluation assets are impaired requires an assessment of whether there are any indicators of impairment, by reference to specific impairment indicators prescribed in IFRS 6 (Note 2). This requires judgement. This includes the assessment, on a project-by-project basis, of the likely recovery of the cost of the Group's Intangible exploration assets in the light of future production opportunities based upon ongoing geological studies. This also involves the assessment of the period for which the entity has the right to explore in the specific area, or if it has expired during the period or will expire soon, if it is not expected to be renewed. Management has a continued plan to explore. In the Tulu Kapi Gold Project Information Memorandum dated March 2024 there were no indicators of impairment.  TKGM license developments are reflected in Note 13.

Estimates:

Share based payments.

Equity-settled share awards are recognized as an expense based on their fair value at date of grant. The fair value of equity settled share options is estimated using option valuation models, which require inputs such as the risk-free interest rate, expected dividends, expected volatility and the expected option life, and is expensed over the vesting period. Some of the inputs used are not market observable and are based on estimates derived from available data.

The models utilized are intended to value options traded in active markets. The share options issued by the Group, however, have several features that make them incomparable to such traded options. The variables used to measure the fair value of share-based payments could have a significant impact on that valuation, and the determination of these variables require a significant amount of professional judgement.

A minor change in a variable which requires professional judgement, such as volatility or expected life of an instrument, could have a quantitatively material impact on the fair value of the share-based payments granted, and therefore will also result in the recognition of a higher or lower expense in the Consolidated Statement of Comprehensive Income. Judgement is also exercised in assessing the number of options subject to non-market vesting conditions that will vest. These judgments are reflected in note 18.

6.   Operating segments

The Group has two principal operating activities, being mineral exploration and corporate activities. Mineral exploration activities are undertaken in Ethiopia and through the Group's exploration investment interests in the Kingdom of Saudi Arabia, while corporate costs, including administration and management, are incurred principally in Cyprus. The Board of Directors is the Group's Chief Operating Decision Maker ("CODM") for the purposes of IFRS 8. The CODM reviews performance and allocates resources on the basis of Ethiopia, Saudi Arabia and Corporate activities. Accordingly, segment information is presented on this basis.

				Corporate		Ethiopia		Saudi Arabia		Adjustments	Consolidated
				£'000		£'000		£'000		£'000	£'000
2024 (Restated)
Corporate costs				(5,638)		(155)		-		(487)	(6,280)
Foreign exchange gain/(loss)				(236)		219		-		361	344
Gain on Dilution of Joint Venture				-		-		832		-	832
Net Finance costs				(2,670)		-		-		-	(2,670)
(Operating (loss)/gain before fair value movements				(8,544)		64		832		(126)	(7,774)
Fair value movement on GMCO (IFRS 9)								6,086		-	6,086
Share of loss from jointly controlled entity				-		-		(391)		-	(391)
Reversal of Impairment of jointly controlled entity				-		-		3,285		-	3,285
Profit / (Loss) before tax				(8,544)		64		9,812		(126)	1,206
Tax				-		-		-		-	-
Profit / (Loss)  for the year				(8,544)		64		9,812		(126)	1,206
Total Non-Current Assets				31,403		26,216		6,432		(19,103)	44,948
Total assets				31,631		26,561		6,432		(19,093)	45,531
Total liabilities				5,699		958		-		(203)	6,454
			Corporate		Ethiopia		Saudi Arabia		Adjustments			Consolidated
			£'000		£'000		£'000		£'000			£'000
2025
Corporate costs			(5,822)		(236)		-		-			(6,058)
Foreign exchange gain/(loss)			60		179		-		(111)			128
Net Finance costs			(3,231)		-		-		-			(3,231)
Operating (loss)/gain before fair value movements			(8,993)		(57)		-		(111)			(9,161)
Fair value movement on GMCO (IFRS 9)			-		-		(533)		-			(533)
Loss before tax			(8,993)		(57)		(533)		(111)			(9,694)
Tax			-		-		-		-			-
Loss for the year			(8,993)		(57)		(533)		(111)			(9,694)
Total Non-Current Assets			44,469		30,974		5,955		(28,420)			52,978
Total assets			50,750		34,375		5,955		(26,722)			64,358
Total liabilities			6,046		1,109		-		-			7,155

 

7.   Expenses by nature

	2025 £'000		2024 £'000
Exploration Cost	-		-
Depreciation of property, plant and equipment (Note 12)	13		18
Directors' fees and other benefits (Note 21.1)	1,625		1,164
Consultants' costs	340		477
Auditors' remuneration	233		189
Legal Costs	965		1,988
Ongoing Listing Costs	421		330
Other expenses	507		524
Financial Project Advisory Costs	917		890
Shareholder Communications	676		314
Travelling Costs	328		338
Total Administrative Expenses	6,025		6,232
Share of losses from jointly controlled entity (Note 6 and Note 14.2)	-		391
Impairment / (Reversal of impairment) of jointly controlled entity (Note14.2)	-		(3,285)
Share based option benefits to directors (Note 18)	-		-
Share based benefits to employees (Note 18)	-		-
Share based benefits to key management (Note 18)	-		-
Share based benefits to suppliers	-		35
Cost for long term project finance (Note 9.2)	677		260
Operating loss	6,702		3,633

 

The Company only capitalises direct evaluation and exploration costs for the Tulu Kapi gold project in Ethiopia.

8.   Staff costs 

	2025 £'000		2024 £'000
Salaries	1,494		1,188
Social insurance costs and other funds	132		126
Costs capitalised as exploration	(1,471)		(1,230)
Net Staff Costs	155		84
Average number of employees	64		58

 

 

Excludes Directors' remuneration and fees which are disclosed in note 21.1. TK project direct staff costs of £1,471,000 are capitalised in evaluation and exploration costs and all remaining salary costs are expensed. Most of the group employees are involved in Tulu Kapi Project in Ethiopia

9.   Finance costs and other transaction costs

 

	2025 £'000			2024 £'000
9.1     Total finance costs
Interest on short term loan	2,587			2,410
Total finance costs	2,587			2,410
9.2     Total other transaction costs
Cost for long term project finance	677			260
Total other transaction costs	677			260

The above costs for long term project finance relate to pre-investigation activities required to fund TK Gold project.

 

 

10. Tax

 

	2025		2024
	£'000		£'000
Profit/ (Loss) before tax	(9,694)		1,206
Tax calculated at the applicable tax rates at 12.5%	(1,219)		158
Tax effect of non-deductible expenses	842		727
Tax effect of tax losses	384		373
Tax effect of items not subject to tax	(7)		(1,258)
Charge for the year	-		-

 

The Company is resident in Cyprus for tax purposes. A deferred tax asset of £1,880k (2024: £2,326k) has not been accounted for due to the uncertainty over future recoverability.

Cyprus

The corporation tax rate is 12.5%. Under certain conditions interest income may be subject to defence contribution at the rate of 17%. In such cases this interest will be exempt from corporation tax.  In certain cases, dividends received from abroad may be subject to defence contribution at the rate of 17%. Due to tax losses sustained in the year, no tax liability arises on the Company. Under current legislation, tax losses may be carried forward and be set off against taxable income of the five succeeding years. As at 31 December 2025, the balance of tax loss which is available for offset against future taxable profits amounts to £15,036k (2024: £ 18,446k) Generally, loss of one source of income can be set off against income from other sources in the same year. Any loss remaining after the set off is carried forward for relief over the next 5 year period.

Tax Year			2021	2022	2023	2024	2025	Total
			£'000	£'000	£'000	£'000	£'000	£'000
Losses carried forward			(2,292)	(4,709)	(2,230)	(2,845)	(2,960)	(15,036)

 

Ethiopia

KEFI Minerals (Ethiopia) Limited, KEFI Minerals (Ethiopia) Holding Share Company and Tulu Kapi Gold Mine Share Company are subject to other direct and indirect taxes in Ethiopia through its foreign operations. The mining industry in Ethiopia is relatively undeveloped. As a result, tax regulations relating to mining enterprises are evolving. There are transactions and calculations undertaken during the ordinary course of business for which the ultimate tax determination is uncertain. The Group recognises liabilities for anticipated tax audit issues based on estimates of whether additional taxes will be due. Where the final tax outcome of these matters is different from the amounts that were initially recorded, such differences will impact the current and deferred tax provisions in the period in which such determination is made.

The government of Ethiopia cut the corporate income tax rate for miners to 25% more than three years ago from 35% and has lowered the precious metals royalty rate to 7% from 8%. According to the Proclamation, holders of a mining licence are required to pay royalty on the sales price of the commercial transaction of the minerals produced. Development expenditure of a licensee or contractor shall be treated as a business intangible with a useful life of four years. If a licensee or contractor incurs development expenditure before the commencement of commercial production shall apply on the basis that the expenditure was incurred at the time of commencement of commercial production. The mining license stipulates that every mining company should allocate 5% free equity shares to the Government of Ethiopia.

United Kingdom

KEFI Minerals (Ethiopia) Limited is resident in United Kingdom for tax purposes. The corporation tax rate is 19%. In December 2016, KEFI Minerals (Ethiopia) Limited elected under CTA 2009 section 18A to make exemption adjustments in respect of the Company's foreign permanent establishment's amounts in arriving at the Company's taxable total profits for each relevant accounting period. This is an exemption for UK corporation tax in respect of the profits of the Ethiopian branch.

 

11. Profit / (Loss) per share

The calculation of the basic and fully diluted loss per share attributable to the ordinary equity holders of the parent is based on the following data:

	Year Ended 31.12.25 £'000		Year Ended 31.12.24 £'000
Net Profit /(loss) attributable to equity shareholders	(9,694)		1,206
Net Profit /(loss) for basic and diluted loss attributable to equity shareholders	(9,694)		1,206
Weighted average number of ordinary shares for basic loss per share (000's)	8,864,751		5,890,502
Weighted average number of ordinary shares for diluted loss per share (000's)	9,000,234		6,154,936
Profit /(Loss) per share:
Basic (loss)/profit per share (pence)	(0.11)		0.02
Basic diluted (loss)/profit per share (pence)	(0.11)		0.02

There was no impact on the weighted average number of shares outstanding during 2025 as all Share Options and Warrants were excluded from the weighted average dilutive share calculation because their effect would be anti-dilutive and therefore both basic and diluted earnings per share are the same in 2025.

 

12. Property, plant and equipment

	Motor Vehicles     £'000		Plant and equipment     £'000		Furniture, fixtures and office equipment £'000		Total       £'000
The Group
Cost
At 1 January 2024	113		125		141		379
Additions	-		33		9		42
Write-offs	-		-		-		-
At 31 December 2024	113		158		150		421
Additions	30		-		16		46
Reclassifications	(10)		(21)		-		(31)
At 31 December 2025	133		137		166		436
Accumulated Depreciation
At 1 January 2024	76		103		100		279
Charge for the year	2		5		11		18
Write offs	-		-		-		-
At 31 December 2024	78		108		111		297
Charge for the year	4		2		7		13
Write offs	-		-		-		-
At 31 December 2025	82		110		118		310
Net Book Value at 31 December 2025	51		27		48		126
Net Book Value at 31 December 2024	35		50		39		124

 

The above property, plant and equipment is in Ethiopia. 

13. Intangible assets

 

Total exploration and project evaluation cost

£'000

The Group

Cost

At 1 January 2024

34,982

Additions

3,676

At 31 December 2024

38,658

Additions

5,848

At 31 December 2025

44,506

Accumulated Amortization and Impairment

At 1 January 2024

266

At 31 December 2024

266

Impairment Charge for the year

At 31 December 2025

266

Net Book Value at 31 December 2025

44,240

Net Book Value at 31 December 2024

38,392

Costs can only be capitalised after the entity has obtained legal rights to explore in a specific area but before extraction has been demonstrated to be both technically feasible and commercially viable.

The addition of £5.8 million is directly associated with the TKGM gold exploration project expenditure and is capitalized as intangible exploration and evaluation cost. Such exploration and evaluation expenditure include directly attributable internal costs incurred in Ethiopia and services rendered by external consultants to ensure technical feasibility and commercial viability of the TKGM project. The value included as Project Exploration and Evaluation costs in the Statement of Cash Flows is affected by the net movements between the intangible assets creditors at 31 December 2024 and the value of these at 31 December 2025, hence it does not match with the Additions to Intangible Assets.

The Company TKGM mining licence is in good standing to 2035 subject to normal compliance of Ethiopian mining regulations.

 

14. Investments

 

14.1  Investment in subsidiaries

The Company	Year Ended 31.12.25 £'000		Year Ended 31.12.24 £'000
Cost
At 1 January	31,402		16,253
Additions	10,409		640
Intercompany loans converted to equity	-		14,509
At 31 December	41,811		31,402

 

The Company carrying value of KEFI Minerals Ethiopia which holds the investment in the Tulu Kapi Gold project currently under development is £41,811,000 as at the 31 December 2025.

Reclassification of Shareholder Loans to Equity

During the financial year ended 31 December 2024, the Company converted shareholder loans to investment in subsidiaries. The loan, amounting to £14,509,000, had no fixed repayment terms and was subordinate to all other debt obligations. This reclassification has resulted in:

·      An increase in investment of £14,509,000.

·      A corresponding decrease in shareholder loans of £14,509,000.

·      No impact on the statement of profit or loss for the year.

During the year, an indicator of impairment review was conducted by the management under IAS 36, and no indicators were identified.

.

Subsidiary companies		Date of acquisition/ incorporation	Country of incorporation		Effective proportion of shares held
Mediterranean Minerals (Bulgaria) EOOD		08/11/2006	Bulgaria		100%-Direct
KEFI Minerals (Ethiopia) Limited		30/12/2013	United Kingdom		100%-Direct
KEFI Minerals Marketing and Sales Cyprus Limited		30/12/2014	Cyprus		100%-Direct
KEFI Minerals (Ethiopia) Holding Share Company		03/09/2025	Ethiopia		100%-Indirect
Tulu Kapi Gold Mine Share Company		31/04/2017	Ethiopia		95%-Indirect
Subsidiary companies	The following companies have the address of:
Mediterranean Minerals (Bulgaria) EOOD	10 Tsar Osvoboditel Blvd., 3rd floor, Sredets Region, 1000 Sofia, the Republic of Bulgaria.
KEFI Minerals (Ethiopia) Limited	27/28 Eastcastle Street, London, United Kingdom W1W 8DH.
KEFI Minerals Marketing and Sales Cyprus Limited	2 Kadmou, Wisdom Tower, 1st Floor, 1105 Nicosia, Cyprus.
KEFI Minerals (Ethiopia) Holding Share Company	2nd Floor, Tirtira Building, Bole Sub-City, Woreda 03 House No. 526, Addis Ababa, Ethiopia
Tulu Kapi Gold Mine Share Company	1st Floor, DAMINAROF Building, Bole Sub-City, Kebele 12/13, H.No, New.

 

The Company owns 100% of Kefi Minerals (Ethiopia) Limited ("KME")

On 8 November 2006, the Company entered into an agreement to acquire from Atalaya Mining PLC (previously EMED) the whole of the issued share capital of Mediterranean Minerals (Bulgaria) EOOD, a company incorporated in Bulgaria, in consideration for the issue of 29,999,998 ordinary shares in the Company. Mediterranean Minerals (Bulgaria) EOOD owned 100% of the share capital of Doğu Akdeniz Mineralleri ("Dogu"), a private limited liability Company incorporated in Turkey, engaging in activities for exploration and developing of natural resources. Dogu was liquidated in 2020.

KME owns 95% of Tulu Kapi Gold Mine Share Company ("TKGM"), a company incorporated in Ethiopia which operates the Tulu Kapi project. The Tulu Kapi Gold Project mining license has been transferred to TKGM. The Government of Ethiopia is entitled to a 5% free-carried interest ("FCI") in TKGM. This entitlement is enshrined in the Ethiopian Mining Law and the Ethiopian Mining Agreement between the Ethiopian Government and KME, as well as the constitution of the project company and is granted at no cost. The 5% FCI refers to the equity interest granted by the company holding the mining license. The Ethiopian Government has also undertaken to invest a further USD$20,000,000 (Ethiopian Birr Equivalent) in associated project infrastructure in return for the issue of additional equity on normal commercial terms ranking pari passu with the shareholding of KME.  Such additional equity is not entitled to a free carry. Upon completion of each element of the infrastructure and approval by the Company, related additional equity will be issued. At the date of this report no equity was issued.

The Company owns 100% of KEFI Minerals Marketing and Sales Cyprus ("KMMSC"), a Company incorporated in Cyprus. The KMMSC was dormant for the year ended 31 December 2025 and 2024. KEFI Minerals Marketing and Sales Cyprus holds the right to market gold produced from the Tulu Kapi Gold Project. It holds no other assets. It is planned that KMMSC will act as agent and off-taker for the onward sale of gold and other products in international markets.

KEFI Minerals (Ethiopia) Holding Share Company ("KMEH") was established in Ethiopia during the year as a holding company for the Group's Ethiopian interests. KMEH was incorporated by KEFI Minerals (Ethiopia) Limited, United Kingdom, to hold and oversee investments in Tulu Kapi Gold Mine Share Company ("TKGM") and other Ethiopian subsidiaries

14.1  Investment in GMCO

Gold & Minerals Co. Limited ("GMCO") is a private company incorporated in the Kingdom of Saudi Arabia, engaged in gold and base metals exploration. Its registered address is Olaya District, 659, King Fahad Road, Riyadh, Kingdom of Saudi Arabia. GMCO was established in May 2009 as a jointly controlled entity with Abdul Rahman Saad Al-Rashid & Sons Company Limited ("ARTAR").

 

KEFI provides GMCO with technical advice and assistance, including personnel to support exploration and technical studies. ARTAR provides administrative advice and assistance. GMCO has five directors, of whom one is nominated by KEFI.

 

KEFI's shareholding in GMCO at each measurement date was as follows:

 

Date	Shareholding
31 January 2024	24.75%
31-Dec-24	15.34%
31-Dec-25	13.35%

 

On 8 October 2025 an extraordinary general meeting of GMCO shareholders approved a resolution to increase GMCO's capital, reducing KEFI's ownership from 15.34% to 13.35%. The formal registration of the revised shareholding with the Saudi Ministry of

Commerce was completed on 20 February 2026; however, KEFI considers the economic substance of the reduction effective from October 2025 in accordance with the shareholders' agreement.

 

As at 31 December 2025, the Group owed ARTAR £400,000 (2024: £347,000) - see Note 20.1.

 

GMCO investment	Date of acquisition/ incorporation	Country of incorporation	Effective proportion of shares held
Gold and Minerals Co. Limited (GMCO)	04/08/2010	Saudi Arabia	13%-Direct

 

Classification and Valuation Technique

At 31 December 2025, the Company holds a non-controlling equity interest of 13% (2024 - 15%) in Gold and Minerals Co. Ltd ("GMCO"), an unlisted private company incorporated in Saudi Arabia and operating in mineral exploration. The investment is classified as a financial asset at fair value through profit or loss and is measured at fair value at each reporting date.

Due to the absence of quoted prices in active markets for identical instruments, the fair value of the investment is categorised within Level 3 of the fair value hierarchy under IFRS 13 at all measurement dates.

14.2.1      Valuation technique

The fair value of the investment has been determined using a market approach, which estimates value by reference to market multiples derived from comparable companies. Specifically, the valuation applies a Resource multiple (£/oz) to GMCO's resources, adjusted for differences between GMCO and the comparable companies.

This valuation technique is considered appropriate as it reflects how market participants would price a similar asset at the measurement date.

14.2.2      Valuation framework

The fair value assessment is performed annually by management using financial models. Key assumptions, including the selection of comparable companies and valuation multiples, are reviewed and approved by senior management. Where appropriate, external valuation specialists are engaged to support management's assessment.

14.2.3      Fair Value Hierarchy

£'000	Level 1	Level 2	Level 3	Total
GMCO - unlisted private equity investment (31 Dec 2025)	-	-	5,955	5,955
GMCO - unlisted private equity investment (31 Dec 2024 restated)	-	-	6,432	6,432

 

14.2.4      Significant Unobservable Inputs

The following table summarises the significant unobservable inputs used in the valuation:

Input	31 Dec 2025	31 Dec 2024	Description
Resources (oz)	3,625 koz AuEq	3,594 koz AuEq	GMCO total in-situ mineral resources at the measurement date (Hawiah, Jibal Qutman and Al Godeyer on a 100% basis), expressed as gold-equivalent ounces.
Resource multiple (£/oz)	£13.99 /oz AuEq	£13.82 /oz AuEq	Blended value-weighted average of median comparable transaction multiples (), derived fromp peers screened by commodity type, development stage and geographic region.
Discount for lack of control (DLOC)	20%	20%	Applied consistently at all measurement dates. Derived from control premium ranges observed in independent expert reports

14.2.5      Level 3 Fair Value Reconciliation

All gains and losses in the reconciliation below are recognised in 'Fair value gain/(loss) on investments' in the consolidated income statement (IFRS 13.93(e)(i)). No amounts are recognised in other comprehensive income. Additions represent KEFI's contributions to maintain its proportionate holding in GMCO, amounting to £346K in 2024 and £56K in 2025. No transfers between hierarchy levels took place in either period.

Movement	Year Ended 31.12.25 £'000	Year Ended 31.12.24 (Restated) £'000
Opening balance	6,432	-
Fair value gain/(loss) - net movement in year	(533)	6,086
Additions / issuances / settlements	56	346
Transfers into / (out of) Level 3	-	-
Closing balance	5,955	6,432

The 2024 Fair value gain represents the IFRS 13 fair value as at 31 December 2024 and the 2025 movement of £(533K) reflects changes in the resource multiple-based valuation. Additions represent additional capital contributions by KEFI to maintain its proportionate interest and do not pass through profit or loss. All gains and losses are unrealised as the investment was held throughout both period

14.2.6      Sensitivity Analysis

The valuation of the Company's equity interest in GMCO relies on Level 3 unobservable inputs, primarily the estimated fair value of the underlying mineral assets (derived via market approach multiples) and the Discount for Lack of Control (DLOC).

The table below summarizes the effect on fair value of reasonably possible changes in these key unobservable inputs, holding all other assumptions constant:

Key Unobservable Input	Base Assumption	Change in Assumption	31.12.25		31.12.24
			Favourable £'000	Unfavourable £'000	Favourable £'000	Unfavourable £'000
EV/Au-eq oz multiple	(Hawiah VMS; Jibal Qutman gold; Al Godeyer) 2025:£13.99 /oz 2024:£13.82 /oz AuEq	+/- 10%	542	(542)	610	(610)
		+/- 20%	1,083	(1,083)	1,219	(1,219)
Discount for Lack of Control	20% discount applied to KEFI's attributable share of GMCO adjusted net assets	-/+ 5%	372	(372)	402	(402)
		-/+ 10%	744	(744)	.804	(804)

 

15. Trade and other receivables

15.1  Current Trade and other receivables

		Year Ended 31.12.25 £'000		Year Ended 31.12.24 £'000
The Group
Prepayments & other receivables		2,102		126
VAT receivable		506		272
		2,608		398

 

 

The Company		Year Ended 31.12.25 £'000		Year Ended 31.12.24 £'000
Prepayments		128		107
		128		107

15.2  Non-current Trade and other receivables

		Year Ended 31.12.25 £'000		Year Ended 31.12.24 £'000
The Group
Prepayments		449		-
Deferred financing cost		2,208		-
		2,657		-

 

 

The Company		Year Ended 31.12.25 £'000		Year Ended 31.12.24 £'000
Prepayments		449		-
Deferred financing cost		2,208		-
		2,657		-

 

15.3  Receivables from subsidiaries

		Year Ended 31.12.25 £'000		Year Ended 31.12.24 £'000
The Company
Receivable from KEFI Minerals (Ethiopia) Holding Limited (Note 21.2) 3		-		-
Receivable from KEFI Minerals (Ethiopia) Limited (Note 21.2) ²		-		5,023
Receivable from Tulu Kapi Gold Mine Share Company (Note 21.2) ¹		-		9,486
Total Advances to Ethiopian Subsidiaries		-		14,509
Expected credit loss		-		(486)
Receivable Classified as Equity during the year		-		(14,509)
Net Receivable Balance		-		(486)
Expected credit loss reversal		-		486
	Total Receivables from Subsidiaries	-		-

 

The Company had loans outstanding from its Ethiopian subsidiaries, the ultimate realisation of which depends on the successful exploration and realisation of the Group's intangible exploration assets. operating liquidity needs.

During the financial year ended 31 December 2025, the Ethiopian subsidiaries had shareholder loans amounting to £nil (2024: £14,509,000). The shareholder loans in respect of the previous financial year  were recorded as Investments in subsidiaries on 1 July 2024 as the Company converted these loans to equity in the subsidiaries.

¹ˌ² ³ During the year, the Company advanced £7,378,000 (2024: £2,745,000) to Tulu Kapi Gold Mine Share Company, £100,100 (2024: £5,100) to Kefi Minerals (Ethiopia) Limited, and £150,000 (2024: £nil) to Kefi Minerals (Ethiopia) Holding Limited.

In accordance with management's assessment that these amounts represent capital contributions rather than repayable loans, these balances were reclassified from intercompany receivables to investments in subsidiaries during the year.

As a result of this reclassification, the balances are no longer recognised within intercompany receivables at the reporting date.

In 2024 due to Management's reclassification of intercompany loans as equity, the expected credit loss provision of £486,000 was no longer required and was reversed.

16. Cash and cash equivalents

	Year Ended		Year Ended
	31.12.25		31.12.24
	£'000		£'000
The Group
Cash at bank and in hand unrestricted	8,772		185
	8,772		185
The Company
Cash at bank and in hand unrestricted	6,153		120
Cash at bank restricted	-		-
	6,153		120

17. Share capital

Issued Capital

The articles of association of the Company were amended in 2010 and the liability of the members of the Company is limited.

 

Issued and fully paid

 

	Number of shares '000		Share Capital	Deferred Shares	Share premium	Total
At 1 January 2024	4,965,125		4,965	23,328	48,922	77,215
Share Equity Placement 8 March 2024	832,653		833	-	4,163	4,996
Share Equity Placement 26 March 2024	83,333		83	-	417	500
Share Equity Placement 28 May 2022	177,982		178	-	1,180	1,358
Share Equity Placement 3 Dec 2024	988,496		988	-	4,448	5,436
Share issue costs	-		-	-	(570)	(570)
Broker warrants: issue costs	-		-	-	(104)	(104)
At 31 December 2024	7,047,589		7,047	23,328	58,456	88,831
	Number of shares '000		Share Capital	Deferred Shares	Share premium	Total
At 1 January 2025	7,047,589		7,047	23,328	58,456	88,831
Share Equity Placement 3 January 2025	933,170		933	-	4,199	5,132
Share Equity Placement 21 May 2025	1,381,818		1,383	-	6,217	7,600
Exercise of Warrants 23 September 2025	68,797		69	-	310	379
Exercise of Warrants 6 October 2025	39,285		39	-	236	275
Exercise of Warrants 8 October 2025	18,750		19	-	94	113
Exercise of Warrants 15 October 2025	38,352		38	-	176	214
Share Equity Placement 30 December 2025	1,213,404		1,213	-	14,561	15,774
Share issue costs	-		-	-	(1,046)	(1,046)
Broker warrants: issue costs	-		-	-	(1,038)	(1,038)
At 31 December 2025	10,741,165		10,741	23,328	82,165	116,234

 

 

	Number of Deferred Shares				£'000	£'000
Deferred Shares 1.6p	2025		2024		2025	2024
At 1 January	680,768		680,768		10,892	10,892
At 31 December	680,768		680,768		10,892	10,892

 

Deferred Shares 0.9p	2025		2024		2025	2024
At 1 January	1,381,947		1,381,947		12,436	12,436
At 31 December	1,381,947		1,381,947		12,436	12,436
Total 31 December	2,062,715		2,062,715		23,328	23,328

 

The deferred shares have no voting rights.

 

2024

During March 2024 the Company raised £5.5 million through the issue of 915,986,055 new ordinary shares of the Company at a placing price of 0.6 pence per Ordinary Share. These new Ordinary Shares were admitted in two tranches, 832,652,722 on 08 March 2024 and 83,333,333 on 26 March 2024, following shareholder approval of the conditional placement at a General Meeting of the Company.

On the 28 May 2024 the Company admitted 177,981,851 new ordinary shares of the Company at a placing price of 0.76 pence per Ordinary Share. These shares, with a total value of £1.35 million, were allocated to key advisers as compensation for their services.

The Company raised £5.5 million through the issue of 988,495,667 new Ordinary Shares at a placing price of 0.55 pence per Ordinary Share.

Of the total value of £12.3 million raised during the year on issue of new ordinary shares of the Company, £7.3 million (2023:4.3 million) was non-cash due to being allocated for the settlement of liabilities (see Note 18.3).

2025

On the 3 January 2025 the Company raised £5.1 million through the issue of 933,169,817 new ordinary shares of the Company at a placing price of 0.55 pence per Ordinary Share.

On the 21 May 2025 the Company raised £7.6 million through the issue of 1,381,818,172 new ordinary shares of the Company at a placing price of 0.55 pence per Ordinary Share.

On the 30 December 2025 the Company raised £15.8 million through the issue of 1,213,403,499 new Ordinary Shares at a placing price of 1.3 pence per Ordinary Share.

During the year brokers exercised 165,184,805 warrants which raised £0.98 million.

Of the total value of £29.5 million raised during the year on issue of new ordinary shares of the Company, £11.2 million (2024: 7.2 million) was non-cash due to being allocated for the settlement of liabilities (see Note 18.3).

Restructuring of share capital into deferred shares

On the 28 June 2019 at the AGM, shareholders approved that each of the currently issued ordinary shares of 1.7p ("Old Ordinary Shares")

The Deferred Shares have no value or voting rights and were not admitted to trading on the AIM market of the London Stock Exchange plc. No share certificates were issued in respect of the Deferred Shares.

 

17. Share Based payments

 

18.1  Warrants

2024

 

During the financial year, the Company experienced a significant reduction in the number of outstanding shareholder warrants. This reduction occurred due to the expiration of 893,096,865 shareholder warrants that were previously issued in two tranches:

·      393,096,865 short-term shareholder warrants issued in accordance with the January 2022 share placement, exercisable at 1.6p per share

·      500,000,000 shareholder warrants authorized in April and May 2022, exercisable at 1.6p per share

In accordance with the terms of issuance, these warrants were subject to the following conditions:

·      Exercise period of two years from the date of Admission

·      Exercise contingent upon a "Warrant Trigger Event" (share price reaching or exceeding 2.4p for five consecutive days)

·      Mandatory exercise within 30 days if the Trigger Event occurred

·      Automatic expiration at the end of the two-year period if not exercised

As the Warrant Trigger Event did not occur during the specified period, and the two-year term has now elapsed, these warrants have expired in accordance with their terms and conditions. This expiration accounts for the material reduction in the number of outstanding warrants reported in the current financial statements compared to the previous reporting period.

During March 2024, the Company issued 37,500,000 broker warrants to Tavira Securities Limited pursuant to the Placing Agreement. These warrants entitle the holder to subscribe for new ordinary shares of 0.1p each at an exercise price of 0.6p per share. The warrants have a three-year term from the date of Second Admission. The fair value of these warrants was determined using the Black-Scholes valuation model and allocated against the share premium account in accordance with IFRS requirements.

In March 2024, the Company issued 12,400,000 Adviser Warrants to an Advisor as compensation for services provided over the previous 12 months. These warrants entitle the holder to subscribe for new ordinary shares of 0.1p each at an exercise price of 0.6p per share. The warrants have a three-year term from the date of Second Admission. The fair value of these warrants was recognized as an expense in the income statement in accordance with IFRS 2 'Share-based Payment'

During January 2025, the Company issued 68,796,818 broker warrants to Tavira Securities Limited pursuant to the Placing Agreement. These warrants entitle the holder to subscribe for new ordinary shares of 0.1p each at an exercise price of 0.55p per share. The warrants have a three-year term from the date of Second Admission. The fair value of these warrants was determined using the Black-Scholes valuation model and allocated against the share premium account in accordance with IFRS requirements.

During May 2025, the Company issued 65,454,546 broker warrants to Tavira Securities Limited pursuant to the Placing Agreement. These warrants entitle the holder to subscribe for new ordinary shares of 0.1p each at an exercise price of 0.55p per share. The warrants have a three-year term. The fair value of these warrants was determined using the Black-Scholes valuation model and allocated against the share premium account in accordance with IFRS requirements.

 

2025

 

During December 2025, the Company issued 69,230,769 broker warrants to Tavira Securities Limited pursuant to the Placing Agreement. These warrants entitle the holder to subscribe for new ordinary shares of 0.1p each at an exercise price of 1.30p per share. The warrants have a three-year term from the date of Admission. The fair value of these warrants was determined using the Black-Scholes valuation model and allocated against the share premium account in accordance with IFRS requirements.

During the year brokers exercised 165,184,805 warrants which raised £0.98 million.

 

Details of warrants outstanding as at 31 December 2025:

Grant date	Expiry date	Exercise price	Expected Life Years		Number of warrants 000's
26 Mar 2024	26 Mar 2027	0.60p	3 years		25,525
21 May 2025	21 May 2028	0.55p	3 years		32,727
22 Dec 2025	22 Dec 2028	1.30p	3 years		69,231
					127,483

 

 

	Weighted average ex. Price	Number of warrants 000's
Outstanding warrants at 1 January 2025	0.72p	164,186
- granted	0.81p	203,482
- cancelled/expired/forfeited	0.80p	(75,000)
- exercised	0.59p	(165,185)
Outstanding warrants at 31 December 2025	0.97p	127,483

 

The estimated fair values of the warrants were calculated using the Black Scholes option pricing model and Trinomial Model when deemed more appropriate.

The inputs into the model and the results for warrants and options granted during the year are as follows:

					Warrants
					03-Jan-25	21-May-25	22-Dec-25
Closing share price at issue date					0.50p	0.57p	1.45p
Exercise price					0.55p	0.55p	1.3p
Expected volatility					69%	70%	68%
Expected life					3yrs	3yrs	3yrs
Risk free rate					4.21%	4.04%	3.79%
Expected dividend yield					Nil	Nil	Nil
Estimated fair value					0.15p	0.27p	0.73p

 

 

Expected volatility was estimated based on the historical underlying volatility in the price of the Company's shares.

Share options reserve table	Year Ended 31.12.25 £'000		Year Ended 31.12.24 £'000
Opening amount	1,948		3,675
Broker Warrants issued costs	785		104
Adviser warrants issue costs	-		35
Share options charges relating to employees (Note18)	-		-
Share options issued to directors and key management (Note 18)	-		-
Share options issued to advisor (Note 18)	-		-
Forfeited options	-		-
Exercised warrants	(368)		-
Expired warrants	(315)		(1,663)
Expired options	(1,116)		(203)
Closing amount	934		1,948

 

 

18.2  Share options reserve

Details of share options outstanding as at 31 December 2025:

Grant date	Expiry date	Exercise price		Number of shares 000's
12-Sep-23	11-Sep-30	0.60p		8,000
				8,000

 

 

	Weighted average ex. Price		Number of shares000's
Outstanding options at 1 January 2025	2.39p		100,249
-  granted	-		-
-  forfeited	2.55p		(92,249)
- cancelled/ expired
Outstanding options at 31 December 2025	0.60p		8,000

 

For 2025, the impact of share option-based payments is a net charge to income of £nil (2024: £35,000). At 31 December 2025, the equity reserve recognized for share option-based payments, including warrants, amounted to £934,000 (2024: £1,948,000).

 

18.3 Share Payments for services rendered and obligations settled.

2024 Year

During the year the company granted the issuance of 1,192,937,000 new Ordinary shares which were distributed across the following placements:

 

March 2024 Share Placement of 461,125,000

After the General Meeting held in March 2024, the Company authorized the issuance of 461,125,000 new Ordinary shares at a placing price of 0.06 pence to fulfil financial obligations totalling £2.8 million

May 2024 Share Placement of 177,981,851

The Company has issued 177,981,851 new ordinary shares of 0.1 pence each at a price of 0.763 pence per Ordinary Share, equivalent to the mid-market closing price on 20 May 2024. These shares, with a total value of £1.35 million, were allocated to key advisers as compensation for their services in support of strategic initiatives that require attention following the commencement of the Early Works Programme at our Tulu Kapi Gold Project in Ethiopia.

December 2024 Share Placement of 553,830,182

During December, the Company resolved its liabilities and other obligations amounting to £3.05million by issuing 553.830,182 new Ordinary Shares at a placing price of 0.55 pence per Ordinary Share.

2025 Year

During the year the company granted the issuance of 1,110,052,380 new Ordinary shares which were distributed across the following placements:

 

January 2025 Share Placement of 274,641,545

After the General Meeting held in January 2025, the Company authorized the issuance of 274,641,545 new Ordinary shares at a placing price of 0.055 pence to fulfil financial obligations totalling £1.5 million

May 2025 Share Placement of 154,545,455

During December, the Company resolved its liabilities and other obligations amounting to £0.85 million, by issuing 154,545,455 new Ordinary Shares at a placing price of 0.55 pence per Ordinary Share.

December 2025 Share Placement of 680,865,381

During December, the Company resolved its liabilities and other obligations amounting to £8.9million by issuing 680,865,381 new Ordinary Shares at a placing price of 1.3 pence per Ordinary Share.

The total shares set off during 2025 and 2024 for services and obligations was as follows:

		2025			2024
Name		Number of Remuneration and Settlement Shares		Amount	Number of Remuneration and Settlement Shares			Amount
		'000		£'000	'000			£'000
For services rendered and obligations settled H Anagnostaras-Adams		-		-	33,333		200
J Leach		45,455		250	16,667		100
Other employees and PDMRs		56,789		312	-			-
Amount to settle other Bonus Obligations					16,667			100
Amount to settle other Obligations		224,496		1,523	259,259			1,801
Total share-based payments		326,740		2,085	325,926			2,201
Amount to settle loans
Unsecured working capital bridging finance		783,313		9,126	867,011			4,970
		1,110,053		11,211	1,192,937			7,171

 

 

The parties above agreed that the amounts subscribed in the share placements during the year be set-off against the amount due by the Company at the date of the share placement.

 

19.  Non-Controlling Interest ("NCI")

			Year Ended
			£'000
As at 1 January 2024			1,709
Acquisitions of NCI			-
Impact of 5% free carry on additions to assets during the year			196
Result for the year			-
As at 1 January 2025			1,905
Acquisitions of NCI			-
Impact of 5% free carry on additions to assets during the year			512
As at 31 December 2025			2,417

 

During 2018, the Government of Ethiopia received its 5% free carried interest acquired in the Tulu Kapi Gold Project. The group recognized an increase in non-controlling interest in the current year of £512,000 and a decrease in equity attributable to owners of the parent of £196,000.

The NCI of £2,417,000 (2024: £1,905,000) represents the 5% share of the Group's assets of the TKGM project which are attributable to the Government of Ethiopia

The Mining Proclamation entitles the Government of Ethiopia (GOE) to 5% free carried interest in TKGM. The 5% NCI reflects the government interest in the TKGM gold project. The GOE is not required to pay for the 5% free carry interest. The GOE can acquire additional interest in the share capital of the project at market price. The GOE has committed US $20,000,000 to install the off-site infrastructure in exchange for earning equity in Tulu Kapi Gold Mine Share Company. The shareholder agreement signed with the GOE in April 2017 states that once the infrastructure elements are properly constructed and approved by Company the relevant shares will be issued to Ministry of Finance and Economic Cooperation (MOFEC)

The financial information for Tulu Kapi Gold Mine Project as at 31 December 2025:

 

					Year Ended		Year Ended
					31.12.25		31.12.24
					£'000		£'000
Amounts attributable to all shareholders
Non-current assets					46,052		38,514
Current assets					782		280
Cash and Cash equivalents					2,623		65
					49,457		38,859
Equity					48,349		38,105
Current liabilities					1,108		754
					49,457		38,859
Result for the year					-		-

 

 

 

20.  Trade and other payables

20.1        Trade and other payables

The Group		Year Ended 31.12.25 £'000		Year Ended 31.12.24 £'000
Accruals and other payables		5,156		3,809
Other loans		-		-
Amount payable to ARTAR - fellow shareholder of GMCO (Note 14.2)		400		347
Payable to Key Management and Shareholder (Note 21.3)		1,424		1,559
		6,980		5,715

 

Other loans are unsecured, interest free and repayable on demand.

 

The Company	Year Ended 31.12.25 £'000		Year Ended 31.12.24 £'000
Accruals and other payables	4,222		3,268
Amount payable to ARTAR - fellow shareholder of GMCO (Note 14.2)	400		347
Payable to Key Management and Shareholder (Note 21.4)	1,424		1,559
	6,046		5,174

 

The fair values of trade and other payables due within one year approximate to their carrying amounts as presented above.

21.  Related party transactions

The following transactions were carried out with related parties:

21.1        Compensation of key management personnel

The total remuneration of key management personnel was as follows:

	Year Ended 31.12.25 £'000		Year Ended 31.12.24 £'000
Short term employee benefits:
¹Directors' consultancy fees	785		546
Directors' other consultancy benefits	40		265
Directors' bonus	800		-
²Key management fees	321		713
Key management other benefits	-		-
Key management bonus	250
	2,196		1,524
Share based payments:
Directors' bonus	-		353
Share option-based benefits to directors (Note 18)	-		-
Share option-based benefits other key management personnel (Note 18)	-		-
Key management bonus	-		50
	-		403
	2,196		1,927

 

¹Directors' fees paid to the Executive Director Chairman and Finance Director are paid to consultancy companies of which they are beneficiaries. Further details on Directors' consultancy and other benefits are available on page 72.

In addition to the directors ²Key Management comprises Chief Operating Officer and the Managing Director Ethiopia.

21.2        Transactions with shareholders and related parties

The Company
Name	Nature of transactions	Relationship	2025 £'000		2024 £'000
KEFI Minerals Marketing and Sales Cyprus Limited	Finance	Subsidiary	-		-
Tulu Kapi Gold Mine Share Company¹	Receivable Equity	Subsidiary	-		-
Kefi Minerals (Ethiopia) Limited²	Receivable Equity	Subsidiary	-		-
			-		-

 

¹The TKGM and KME loans are denominated Birr. The Company bears the foreign exchange risk on these loans and any movements in the Ethiopian Birr are recorded in the income statement of the Company.

As a result of this reclassification, management has determined that expected credit losses on these borrowings as at 31 December 2025 would be nil (2024: nil). This is because expected credit losses are not required for assets classified as equity in the Company's financial statements.

There was a was £nil expected credit loss provision in the statement of profit or loss for the year ended 31 December 2025 (2024: 486,000).

21.3        Payable to related parties

The Group			2025 £'000		2024 £'000
Name	Nature of transactions	Relationship
Directors & PDMR	Fees for services	Key Management and Shareholder	1,424		1,559
			1,424		1,559

 

 

21.4        Payable to related parties

The Company			2025 £'000		2024 £'000
Name	Nature of transactions	Relationship
Directors & PDMR	Fees for services	Key Management and Shareholder	1,424			1,559
			1,424			1,559

 

22.  Loans and Borrowings

22.1 Short-Term Working Capital Bridging Finance

	Currency	Interest	Maturity	Repayment
Unsecured working capital bridging finance	GBP	See table	On Demand	See table below
Bank Loan	ETB	20%	One Year	10 August 2026

 

2025

Unsecured working capital bridging finance	Balance 1 Jan 2025  £'000	Drawdown Amount   £'000	Transaction Costs   £'000	Interest     £'000	Repayment Shares   £'000	Repayment Cash   £'000	Year Ended 31 Dec 2025  £'000
Repayable in cash in less than a year	525	7,803	-	2,587	(8,876)	(2,039)	-

 

Bank Loan	Balance 1 Jan 2025  £'000	Drawdown Amount   £'000	FX Gain   £'000	Interest     £'000	Repayment Shares   £'000	Repayment Cash   £'000	Year Ended 31 Dec 2025  £'000
Repayable in cash in less than a year	214	186	(21)	10	-	(214)	175

 

 

2024

Unsecured working capital bridging finance	Balance 1 Jan 2024  £'000	Drawdown Amount   £'000	Transaction Costs   £'000	Interest     £'000	Repayment Shares/Netting £'000	Repayment Cash   £'000	Year Ended 31 Dec 2024  £'000
Repayable in cash in less than a year	2,113	4,300	-	2,411	(4,971)	(3,328)	525
	2,113	4,300	-	2,411	(4,971)	(3,328)	525

 

Bank Loan	Balance 1 Jan 2024  £'000	Drawdown Amount   £'000	FX Gain   £'000	Interest     £'000	Repayment Shares   £'000	Repayment Cash   £'000	Year Ended 31 Dec 2024  £'000
Repayable in cash in less than a year	-	424	(251)	41	-	-	214

 

 

 

The short-term working capital finance is unsecured and ranks below other loans. Although there was no binding agreement to convert the loans into shares, the lenders agreed to convert and set off some of the debt into shares.

 

Non-cash settlement of short-term working capital finance during the year was £8,876,000 (2024: £4,971,000).

22.2 Reconciliation of liabilities arising from financing activities

2025 Reconciliation		Cash Flows
	Balance 1 Jan 2025	Inflow	(Outflow)	FX Gain	Finance Costs	Shares	Balance 31 Dec 2025
	£'000	£'000	£'000	£'000	£'000	£'000	£'000
Unsecured working capital bridging finance
Short term loans	739	7,989	(2,253)	(21)	2,597	(8,876)	175
	739	7,989	(2,253)	(21)	2,597	(8,876)	175
2024 Reconciliation
	Balance 1 Jan 2024	Inflow	(Outflow)	Fair Value Movement	Finance Costs	Shares/Netting	Balance 31 Dec 2024
	£'000	£'000	£'000	£'000	£'000	£'000	£'000
Unsecured working capital bridging finance
Short term loans	2,113	4,724	(3,328)	(251)	2,452	(4,971)	739
	2,113	4,724	(3,328)	(251)	2,452	(4,971)	739

23.  Contingent liabilities

Directors and Key Management Personnel are eligible for a performance-based short-term incentive plan (STI), which is contingent upon securing credit approvals from lenders.

 

24.  Legal Allegations

 

In prior periods, a claim was brought against the Company by Demissie Asafa Demissie (the "Claimant") for an alleged amount of GBP 5.1 million, relating to alleged commission under a consultancy services agreement in connection with the financing of the Tulu Kapi Gold Mine project. The Company defended the claim in full and filed a counterclaim against the Claimant.

On 20 January 2025, the High Court of Justice (King's Bench Division) dismissed all claims against the Company in their entirety. On 9 January 2026, the Court of Appeal refused the Claimant permission to appeal, bringing the matter to a final conclusion.

The matter related to a prior GBP 5.1 million claim by Demissie Asafa Demissie concerning alleged commission payments linked to financing for the Tulu Kapi Gold Mine project. The Company fully defended the claim and filed a counterclaim. The High Court dismissed all claims against the Company on 20 January 2025, and the Court of Appeal refused permission to appeal on 9 January 2026, bringing the case to a final conclusion.

No provision has been recognised in these financial statements. The Directors are satisfied, confirmed by the judicial outcome, that there was no probable obligation at the reporting date.

 

25.  Capital commitments The Group has the following capital or other commitments as at 31 December 2025 £96,000 (2024: £140,000),           31 Dec 2025 £'000 31 Dec 2024 £'000 Contracted for: Tulu Kapi Project costs 96 140

26.  Events after the reporting date

 

The following events occurred after the balance sheet date of 31 December 2025 and prior to the date of approval of these financial statements. All items below are non-adjusting events and do not affect the amounts recognised in these financial statements.

On 11 February 2026, the Company's subsidiary Tulu Kapi Gold Mines S.C. ("TKGM") entered into a US$20 million equity-ranking gold royalty agreement with Chancery Royalty Limited, forming part of the US$340 million Tulu Kapi project finance package. The royalty is payable only alongside distributions by TKGM to its shareholders.

On 18 February 2026, the Company issued 9,818,182 ordinary shares of 0.1 pence each at 0.55 pence per share following the exercise of broker warrants issued in May 2025, for gross proceeds of £54,000.

During March 2026, the Company concluded a placement, issuing 2,964,194,769 new ordinary shares at a price of 1.2 pence per share, generating £35.6million in proceeds.

Name		Number of Subscription Shares		Amount
		'000		£'000
Cash Placement		2,893,146		34,718
Current liabilities
For services rendered		71,049		852
		2,964,195		35,570

 

On 5 May 2026, the Company issued 44,444,444 ordinary shares of 0.1 pence each at 1.35 pence per share, comprising 22,222,222 remuneration shares to the Company's Head of Exploration and 22,222,222 fee shares to a service provider in discharge of a contractual liability.

On the same date, the Company granted 649,779,900 options over ordinary shares under its Share Option Scheme to four members of senior management at an exercise price of 2.0 pence per share, vesting in three equal annual instalments on 31 December 2027, 2028 and 2029 and expiring on 31 December 2030. No IFRS 2 charge in respect of these options is recognised in the year ended 31 December 2025; the charge will arise from the year ending 31 December 2026.

During May 2026 a US$10 million equity ranking royalty at subsidiary level was secured with financier Mithril Royalties Limited.