CORPORATE GOVERNANCE STATEMENT

CHAIRMAN'S OVERVIEW

The Board considers the Corporate Governance Code 2018, published by the Quoted Companies Alliance ("the QCA Code"), to be the most suitable corporate governance code for the Company.  The Company has adopted the QCA Code and the Principles which it contains.  The QCA Code's 10 Principles and an explanation of how these are complied with by the Company are set out after this overview. 

The Board is collectively responsible to shareholders for the success of the Group. The Board is responsible for the management of the business of the Company, setting the strategic direction of the Company, establishing the policies of the Company and appraising the making of all material investments.

It is also the Board's responsibility to oversee the financial position of the Company and to monitor the business and affairs of the Company on behalf of the shareholders, to whom the directors are accountable. The primary duty of the Board will be to act in the best interests of the Company at all times. The Board will also address issues relating to internal control and the Company's approach to risk management. To this end, the Company has established an audit committee of the Board (the "Audit Committee") with formally delegated duties and responsibilities.

The Audit Committee, which comprises Christopher Latilla-Campbell as Chairman and Christian Schaffalitzky de Muckadell will meet at least twice a year. The Audit Committee will be responsible for the Company's internal controls and ensuring that the financial performance of the Group is properly measured and reported. In addition, the Audit Committee will receive and review reports from management and the auditor relating to the interim report, the annual report and accounts and the internal control systems of the Company.

The Audit Committee will also make recommendations to the Board on the appointment of the auditor and the audit fee.

The Company has also established a remuneration committee of the Board (the "Remuneration Committee") with formally delegated duties and responsibilities.

The Remuneration Committee which comprises Christian Schaffalitzky de Muckadell as Chairman and Christopher Latilla-Campbell will meet at least once a year. The Remuneration Committee will be responsible for reviewing, determining and recommending to the Board the future policy for the remuneration of the executive directors and officers. The Remuneration Committee will consider base fees, salaries and incentive entitlements and awards and, where appropriate, pension arrangements. The aggregate remuneration of the directors is limited by the Company's Articles of Association and this aggregate amount can only be changed by the Company in general meeting.

The Board has adopted a share dealing code (the "Share Dealing Code") regulating trading in the Company's shares for the Directors and other persons discharging managerial responsibilities (and their persons closely associated) which contains provisions appropriate for a company whose shares are listed on the Official List and admitted to trading on the Main Market for listed securities of the London Stock Exchange (particularly relating to dealing during closed periods which will be in line with the Market Abuse Regulation). The Company will take all reasonable steps to ensure compliance by the Directors and any relevant employees with the terms of the Share Dealing Code.

The Board currently comprises three directors of which two are non-executive and one is executive. The Board as a whole believes that its current composition provides an appropriate level of balance in the Board and the Company's management.  However, the Board is considering the possibility of making an additional appointment to the Board.

Christopher Latilla-Campbell

Non-Executive Chairman

QCA Code and Company compliance  

The QCA Code, which the Company has adopted, contains 10 Principles which are set out below together with an explanation of how the Company applies each Principle.

Principle One: Establish a strategy and business model which promote long-term value for shareholders.

The Company has a clearly defined strategy and business model which has been adopted and implemented by the Board and which it believes will achieve long term value for the shareholders.  Details of the Company's strategy are set out in the Strategic Report. 

Principle Two: Seek to understand and meet shareholder needs and expectations.

The Board is committed to maintaining good communications with its shareholders and with investors with a view to understanding their needs and expectations.  The Board and, in particular, the Chairman and Chief Executive Officer, maintain close contact with many of the shareholders.

All shareholders are encouraged to attend the Company's Annual General Meetings where they can meet and directly communicate with the Board. Shareholders and investors are also able to meet with members of the Board at investor presentations and investor shows where the Company may be attending as a presenter or an exhibitor and where up to date corporate presentations may be made after which members of the Board are available to answer questions from shareholders and investors.

The Company publishes an Annual Report and Accounts and an Interim Results Announcement both of which are posted to the Company's website.  The Annual Report and Accounts provides shareholders and investors with details of the Company's Financial Statements for the financial year under review together with the Strategic and Directors' Reports and other reports. The Interim Results Announcement provides shareholders and investors with details of the Company's Financial Statements for the six months under review together with Operational Highlights and a Business Review.

The Company also provides regular regulatory announcements and business updates through the Regulatory News Service (RNS) and copies of such announcements are posted to the Company's website. The Company also provides information and topics for discussion through social media channels.

Shareholders and investors also have access to information on the Group through the Company's website, www.metalnrg.com, which is updated on a regular basis and which also includes the latest corporate presentation on the Group.

Principle Three: Take into account wider stakeholder and social responsibilities and their implications for long-term success.

The Board recognises that the long-term success of the Group is reliant on the efforts and participation of its staff, partners, contractors, suppliers, advisers, and other stakeholders. The Board maintains close contact and liaison with these important relationships.

The Board is very aware of the significance of social, environmental and ethical matters affecting the business of the Group.

The Company will engage positively and seek to develop close relationships with local communities, regulatory authorities and stakeholders which are in close proximity to or connected with its overseas operations and, where appropriate, the Board will take steps to safeguard the interests of such stakeholders.

The Board plans, in due course, to adopt appropriate environmental and corporate responsibility policies to ensure that the Group's activities have minimal environmental impact on the local environment and communities close to the Group's projects.

Principle Four: Embed effective risk management, considering both opportunities and threats, throughout the organisation.

Mining exploration, evaluation and development generally carry high levels of risk and the Board recognises that the principal risks and uncertainties facing the Group at this stage in relation to its projects are inherently high.

The Board regularly reviews its business strategy and, in particular, identifies and evaluates the risks and uncertainties which the Group is or may be exposed to. As a result of such reviews, the Board will take steps to manage risks or seek to remove or reduce the Group's exposure to them as much as possible.  The risks and uncertainties to which the Group is exposed at present and in the foreseeable future are detailed in Risks and Uncertainties in the Strategic Report on pages 5 and 6 together with risk mitigation strategies employed by the Board.

Principle Five: Maintain the Board as a well-functioning, balanced team led by the Chairman.

Christopher Latilla-Campbell, the non-executive Chairman, leads the Board and is responsible for the effective performance of the Board through control of the Board's agendas and the running of its meetings at which, through the review and discussion of management reports, the Group's performance can be regularly monitored.  Christopher Latilla-Campbell, in his capacity as non-executive Chairman, also has overall responsibility for the corporate governance of the Company. The day to day running of the Group is delegated to Rolf Gerritsen, the Chief Executive Officer. 

The Board holds Board meetings at least four times a year and periodically, as and when issues arise which require the attention of the Board.  Prior to such meetings, the Board's members receive an appropriate agenda and relevant information and reports for consideration on all significant strategic, operational and financial matters and other business and investment matters which may be discussed and considered.

The Board is supported by the Audit and Remuneration Committees, details of which are set out above.

In accordance with the Company's Articles of Association, the Board is required to retire each year at the Company's Annual General Meeting and the retiring Directors may offer themselves for re-election.

Principle Six: Ensure that between them the directors have the necessary up to date experience, skills and capabilities.

The Directors have a wide range of skills and experience which cover sector, technical, financial, operational and public markets areas which are relevant to the management of the Group's business. 

Details of the current Board of Directors' biographies are set out on page 2.

The Board regularly reviews its structure and whether it has the right mix of relevant skills and experience for the effective management of the Group's business.  The Board considers that the current balance of sector, technical, financial, operational and public markets skills and experience which its directors have is appropriate at present given the current size and stage of development of the Company. 

The Directors maintain their skills through membership of various professional bodies, attendance at mining conferences and seminars and through their various external appointments.

All Directors have access to the Company Secretary, City Group PLC, which is responsible for ensuring that Board procedures and applicable rules and regulations are observed and relevant corporate and regulatory information is provided to the Directors.

Principle Seven: Evaluate Board performance based on clear and relevant objectives, seeking continuous improvement.

The Board's performance as a whole is reviewed and considered in the light of the progress and achievements against the Group's long-term strategy and its strategic objectives. This progress is regularly reviewed in Board meetings and the structure, size and composition of the Board are also considered.

All Directors are encouraged to maintain personal continuing professional education programmes and all Directors are entitled to receive relevant and appropriate training if required.

Principle Eight: Promote a corporate culture that is based on ethical values and behaviours.

The Company has established corporate governance arrangements which the Board believes are appropriate for the current size and stage of development of the Company. 

The Company has adopted a number of policies applicable to directors, officers and employees and, in some cases, to suppliers and contractors as well, which, in addition to the Company's corporate governance arrangements set out above, are designed to provide the Company with a positive corporate culture that understands and meets shareholder and stakeholder needs and expectations whilst delivering long-term value for shareholders.  The Company's policies include a Share Dealing Policy; an Insider Dealing and Market Abuse Policy, an Anti-Bribery and Corruption Policy, a Whistleblowing Policy, a Social Media Policy and the Company's Code of Business Conduct;

The Board recognises that its mineral exploration and development activities can have an impact on the local environment and communities in close proximity to its operations.  The Company seeks to engage positively and to develop close relationships with local communities, regulatory authorities and stakeholders which are in close proximity to or connected with its operations and where appropriate the Board will take steps to safeguard the interests of such stakeholders. 

Principle Nine: Maintain governance structures and processes that are fit for purpose and support good decision-making by the Board.

Whilst the Board has overall responsibility for all aspects of the business, Christopher Latilla-Campbell, the non-executive Chairman, is responsible for overseeing the running of the Board and ensuring that Board focuses on and agrees the Group's long-term direction and its business strategy and reviews and monitors the general performance of the Group in implementing its strategic objectives and its achievements. Key operational and financial decisions are reserved for the Board through quarterly and periodic project reviews, annual budgets, and quarterly budget and cash-flow forecasts and on an ad hoc basis where required.

As non-executive Chairman, Christopher Latilla-Campbell has overall responsibility for corporate governance matters in the Group. Christopher Latilla-Campbell and Christian Schaffalitzky de Muckadell, the Company's two non-executive Directors, are responsible for bringing independent and objective judgment to Board decisions.

The Board has established Audit and Remuneration Committees with formally delegated duties and responsibilities. Further details of these committees are set out above.

Rolf Gerritsen, the Chief Executive Officer, has the responsibility for implementing the strategy of the Board and managing the business activities of the Group on a day-to-day basis.

City Group, the Company Secretary, is responsible for ensuring that Board procedures are followed, and applicable rules and regulations are complied with.

Principle Ten: Communicate how the Company is governed and is performing by maintaining a dialogue with shareholders and other relevant stakeholders.

The Company is committed to maintaining good communication with its shareholders, the Company's key stakeholder group. Members of the Board regularly communicate with, and encourage feedback from, its shareholders. The Company's website is regularly updated and users, including shareholders, can contact the Company using the contact details on the website should stakeholders wish to make enquiries of management.

The Group's financial reports, its Annual Report and Accounts and Interim Results Announcements, can be found in the Investors section of the website, www.metalnrg.com.

Notices of General Meetings are posted to shareholders and copies for past years are available on the Company's website.

The results of voting on all resolutions in future general meetings will be posted to the Company's website, including any actions to be taken as a result of resolutions for which votes against have been received from 20 per cent or more of independent votes cast.

This Corporate Governance Statement will be reviewed at least annually to ensure that the Company's corporate governance framework evolves in line with the Company's strategy and business plan.

DIRECTORS' REMUNERATION REPORT

The Company has established a Remuneration Committee which is responsible for reviewing, determining and recommending to the Board the future policy for the remuneration of the Directors, the scale and structure of the Directors' fees, taking into account the interests of shareholders and the performance of the Company and Directors.

The items included in this report are audited unless otherwise stated.

Statement of MetalNRG Plc's policy on directors' remuneration by the Chairman of the Remuneration Committee, Christian Schaffalitzky de Muckadell

As Chairman of the Remuneration Committee, I am pleased to introduce our Directors' Remuneration Report. The Directors' Remuneration Policy, which is set out below, on pages 21 to 24, will be submitted to shareholders for approval at our Annual General Meeting on 20 June 2022.

A key focus of the Directors' Remuneration Policy is to align the interests of the Directors to the long-term interests of the shareholders and it aims to support a high-performance culture with appropriate reward for superior performance, without creating incentives that will encourage excessive risk taking or unsustainable company performance. This will be underpinned through the implementation and operation of incentive plans.

The Remuneration Committee which comprises myself as Chairman, and Christopher Latilla-Campbell, will meet at least once a year. Executive Directors' and Officers' remuneration is set at these meetings although Board meetings are held where the remuneration of Directors and the Remuneration Committee's recommendations are considered.

Remuneration Components

The Company remunerates Executive Directors and Officers in line with best market practice in the industry in which it operates. The components of Director remuneration that are considered by the Board for the remuneration of Directors consist of:

·    Base salaries

·    Pension and other benefits

·    Annual bonus

·    Share incentive arrangements

·    Share options

Rolf Gerritsen, Chief Executive Officer, and Windell Callaghan, MetalNRG's Chief Financial Officer, have entered into service agreements with the Company and are also paid base salaries. Christopher Latilla-Campbell and Christian Schaffalitzky de Muckadell are appointed by letters of appointment and are paid Directors' fees.

All such contracts impose certain restrictions as regards the use of confidential information and intellectual property and the executive Directors' and Officer's service contracts impose restrictive covenants which apply following the termination of the agreements.

Other matters

In February 2021, the Company introduced a Share Option Plan 2021 (the "Plan") for executives and selected senior management, designed to promote the retention, recruitment and incentivisation of the Company's leadership team.

The Company has established a workplace pension scheme and Rolf Gerritsen and Windell Callaghan qualify whereas Christopher Latilla-Campbell is eligible under the auto-enrolment pension rules. The workplace pension scheme currently pays pension amounts in relation to directors' and officer's remuneration. The Company has not paid out any excess retirement benefits to any directors or past directors.

Recruitment Policy

Base salary levels take into account market data for the relevant role, internal relativities, their individual experience and their current base salary. Where an individual is recruited at below market norms, they may be re-aligned over time, subject to performance in the role. Benefits will generally be in accordance with the approved policy. For external and internal appointments, the Board may agree that the Company will meet certain relocation and/or incidental expenses as appropriate.

Payment for loss of Office

If a service contract is to be terminated, the Company will determine such mitigation as it considers fair and reasonable in each case.

The Company reserves the right to make additional payments where such payments are made in good faith in discharge of an existing legal obligation (or by way of damages for breach of such an obligation); or by way of settlement or compromise of any claim arising in connection with the termination of an executive director's office or employment.

Service Agreements and Letters of Appointment

The terms of all the directors' appointments are subject to their re-election by the Company's shareholders at Annual General Meetings at which certain of the directors will retire on a rotational basis and offer themselves for re-election.

The Executive Directors' and Officer's service agreements are set out in the table below. The agreements are not for a fixed term and may be terminated by either the Company or the Executive Director or Officer on giving appropriate notice.

Details of the terms of the agreement for the Executive Director and Officer are set out below:

Pierpaolo Rocco resigned as a Director of the Company on 19 October 2021.

The Non-Executive Directors of the Company have been appointed by letters of appointment. Each Non-Executive Director's term of office runs for an initial period of three years and thereafter, with the approval of the Board, will continue subject to periodic retirement and re-election or termination or retirement in accordance with the terms of the letters of appointment.

The details of each Non-Executive Director's current term are set out below:

Executive directors' remuneration - Audited

The table below sets out the remuneration received by the Executive Directors for the year ended 31 December 2021:

* Pierpaolo Rocco resigned as a Director of the Company on 19 October 2021 but was paid until 21 December 2021, when his employment was terminated by the Company.

Officer's remuneration - Audited

The table below sets out the remuneration received by the Officer for the year ended 31 December 2021:

Non-executive directors' remuneration - Audited

The table below sets out the remuneration received by the Non-Executive Directors during the year ended 31 December 2021:

Directors' beneficial share interests - Audited

The interests of the Directors, who served during the year ended 31 December 2021, in the share capital of the Company at 31 December 2021 and at the date of this report were as follows:

* The 5,977,612 options issued to P Rocco on 1 February 2021 lapsed on termination of his employment on 21 December 2021. 

** Includes 24,750,000 ordinary shares held by Buchanan Trading Inc, in whose shares he is deemed to be interested, as he is a potential beneficiary of a discretionary trust which controls it.

Relative importance of spend on pay

The table below illustrates a comparison between Directors' total remuneration to distributions to shareholders and loss before tax for the financial year ended 31 December 2021:

Total Director remuneration includes salaries and fees, for directors in continuing operations. Further details on Directors' remuneration are provided in note 3 to the Financial Statements.

Group operational cash outflow has been shown in the table above as cash flow monitoring and forecasting in an important consideration for the Board when determining cash-based remuneration for directors and employees.

Consideration of shareholder views

The Board considers shareholder feedback received and guidance from shareholder bodies. This feedback, plus any additional feedback received from time to time, is considered as part of the Company's annual policy on remuneration.

Approved on behalf of the Board of Directors

Christian Schaffalitzky de Muckadell

Chairman of the Remuneration Committee

28 April 2022

INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF METALNRG PLC

FOR THE YEAR ENDED 31 DECEMBER 2021

Opinion

We have audited the financial statements of MetalNRG plc (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 December 2021 which comprise the Consolidated Statement of Profit or Loss, the Consolidated Statement of Comprehensive Income, the Consolidated and Company Statements of Financial Position, the Consolidated and Company Statements of Changes in Equity, the Consolidated and Company Cash Flow Statements and the notes to the financial statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and International Financial Reporting Standards (IFRSs) as adopted by the European Union and, as regards the parent company financial statements, as applied in accordance with the provisions of the Companies Act 2006.

In our opinion:

·   the financial statements give a true and fair view of the state of the group's and of the parent company's affairs as at 31 December 2021 and of the group's loss for the year then ended;

·   the group financial statements have been properly prepared in accordance with IFRSs as adopted by the European Union;

·   the parent company financial statements have been properly prepared in accordance with IFRSs as adopted by the European Union and as applied in accordance with the provisions of the Companies Act 2006; and

·   the financial statements have been prepared in accordance with the requirements of the Companies Act 2006.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) ("ISAs (UK)") and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the group and parent company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC's Ethical Standard as applied to listed entities, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.

Key Audit Matters

Key audit matters are those that, in our professional judgement, were of most significance in our audit of the Financial Statements of the current year and include the most significant assessed risks of material misstatement (whether or not due to fraud) we identified, including those which had the greatest effect on: the overall audit strategy, the allocation of resources in the audit and directing the efforts of the engagement team. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

An overview of the scope of our audit

As part of designing our audit, we determined materiality and assessed the risks of material misstatements in the Financial Statements. As in all our audits, we addressed the risk of management override of controls, including among other matters consideration of whether there was any evidence of bias that represented a risk of material misstatement due to fraud.

Our application of materiality

We apply the concept of materiality both in planning and performing our audit and in evaluating the effect of misstatements. We consider materiality to be the magnitude by which misstatements, including omissions could influence the economic decisions of reasonable users that are taken on the basis of the financial statements. Importantly, misstatements below these levels will not necessarily be evaluated as material, as we also take into account the nature of identified misstatements, and the particular circumstances of their occurrence, when evaluating their effect on the financial statements as a whole.

Based on our professional judgement, we determined the materiality for the financial statements ("Financial Statement materiality") as a whole to be £79,000 (2020: £31,000) which is based on 2.5% of gross assets. We considered this as an appropriate benchmark as Investments are held for long term future growth.

We set Performance materiality as 80% of the overall Financial Statement materiality.

Other information

The other information comprises the information included in the parent company's annual report, other than the financial statements and our auditor's report thereon. The directors are responsible for the other information. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of the audit:

·   the information given in the strategic report and the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and

·   the strategic report and the directors' report have been prepared in accordance with applicable legal requirements.

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the parent company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report.

We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:

·   adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or

·   the financial statements of the parent company are not in agreement with the accounting records and returns; or

·   certain disclosures of directors' remuneration specified by law are not made; or

·   we have not received all the information and explanations we require for our audit.

Responsibilities of directors

As explained more fully in the directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the directors are responsible for assessing the parent company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the parent company or to cease operations, or have no realistic alternative but to do so.

Auditor's responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but it is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

Auditor's responsibilities for the audit of the financial statements, continued

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:

·    Enquiries with management, about any known or suspected instances of non-compliance with laws and regulations and fraud.

·    Auditing the risk of management of override controls, including through testing journal entries and other adjustments for appropriateness.

Because of the field in which the parent company operates, we identified that employment law, LSE Listing Rules and compliance with the Companies Act 2006 are most likely to have a material impact on the financial statements.

The group is subject to many other laws and regulations where consequences of non-compliance could have material effect on amounts or disclosures in the financial statements, for instance through the imposition of fines. We identified the following areas as most likely to have such an effect: The Listing Rules in certain aspects of company legislation recognising the financial and regulated nature of the parent company's activities and its legal form. Auditing standards limit required audit procedure to identify non-compliance with these laws and regulations to inquiry of the directors and other management and inspection of regulatory and legal correspondence, if any. Through these procedures, we did not become aware of actual or suspected non-compliance.

Owing to the inherent limitations of an audit, there's an unavoidable risk that some material misstatements in the financial statements may not be detected, even though the audit is properly planned and performed in accordance with ISAs (UK). For instance, the further removed non-compliances from the events and transactions reflected in the financial statements, the less likely the auditor is to become aware of it or to recognise the non-compliance.

As part of an audit in accordance with ISAs (UK), we exercise professional judgment and maintain professional scepticism throughout the audit. We also:

·   Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

·   Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the internal control.

·   Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the directors.

·   Conclude on the appropriateness of the directors' use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the parent company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause the parent company to cease to continue as a going concern.

·   Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

Auditor's responsibilities for the audit of the financial statements, continued

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

Use of our report

This report is made solely to the parent company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the parent company's members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the parent company and the parent company's members as a body, for our audit work, for this report, or for the opinions we have formed.

Mr Lee Lederberg (Senior Statutory Auditor)

28 April 2022

MetalNRG plc

CONSOLIDATED STATEMENT OF PROFIT OR LOSS

FOR THE YEAR ENDED 31 DECEMBER 2021