Annual Results for the year ended 31 December 2024

faith691
Jun 30
29 min read

30 June 2025

Shuka Minerals Plc

("Shuka" or the "Company")

Annual Results for the year ended 31 December 2024

Shuka Minerals Plc (AIM & AltX: SKA), an African-focused mine operator and developer, announces its audited results for the year ended 31 December 2024.

For Enquiries:

Shuka Minerals Plc Richard Lloyd - CEO	+ 44 (0) 7990 503 007
Strand Hanson Limited Financial and Nominated Advisor James Harris \| Richard Johnson	+44 (0) 20 7409 3494
AcaciaCap Advisors Propriety Limited JSE Sponsor and Listing Advisor Michelle Krastanov	+27 (11) 480 8500
Tavira Securities Limited Joint Broker Oliver Stansfield \| Jonathan Evans	+44 (0) 20 7100 5100
Peterhouse Capital Limited Joint Broker Charles Goodfellow \| Duncan Vasey	+44 (0)20 7469 0930
Investor Relations Faith Kinyanjui Mumbi	+254 746 849 110

The 2024 Annual Report and Accounts is being posted to shareholders and will shortly be available on the Company's website at: https://www.shukaminerals.com/circularreports.

This announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018 ("MAR") and is disclosed in accordance with the Company's obligations under Article 17 of MAR.

CHAIRMAN'S REPORT

In the year ending 31 December 2024, the Company continued its transition in terms of management with a refocus on future strategy and direction and board changes. During this continued period of change Richard Lloyd joined as the new Chief Executive Officer (13/12/24) and Edward Ruheni as a Non-Executive Director, and the Company accepted the resignations of directors Noel Lyons, Paul Ryan and Allan Zimbler, we thank them for their efforts and wish them well in their future endeavours. Jason Brewer also resigned as a Director but continued as a consultant through Gathoni Muchai Investments ("GMI") . The ongoing refocus of the Company has continued into the first half of 2025 with a further major strategic financial commitment to the Company by GMI, subject to final documentation, and the extension of the availability of the AUO Commercial Brokerage LLC ("AUO") convertible loan note by 12 months to March 2026, as well as,material progress on a potential acquisition.

GMI is a Nairobi-based investment firm focused on mining, property and retail sectors and headed up by Jason Brewer and Ms Jackline Muchai. GMI have existing investments in four East African countries, including Tanzania and are a major shareholder in battery metals focused mining company Marula Mining plc and in Neo Energy Metals plc, each London-listed. GMI has a current 20.9% shareholding in Shuka Minerals. Shuka's other major shareholder, AUO, led by myself, has a current interest in 28.2% of the Company's issued shares.

On site in Tanzania, the Rukwa coal mine experienced continued production and output challenges as has been the case historically with this coal asset. However, a sufficient amount of investment, from a further drawdown of the £500,000 GMI loan , is earmarked for H2 2025 and a restart, in mining operations, is expected very soon. Production in 2024 amounted to 63 tonnes of washed coal only this volume is set to be used to retest and restart the wash plant and will then be sold. 60,000 tonnes of "fines" are stockpiled on surface and we hope to achieve a sales price of USD7-8 per tonne for this material which will generate valuable cashflow. A tight rein continues to be kept on costs and we were pleased to have resolved the legacy dispute with the Upendo Group .

A further funding commitment was entered into with GMI on 2 December 2024 with an unsecured, non-convertible, interest free loan of £500,000, £335,000 of which has been drawndown to date. This has been agreed to be further extended by an extra £1.5m, subject to completion of the Company's due diligence and signing of definitive funding documentation, post period, in order to complete the acquisition of Leopard Exploration and Mining Limited ("LEM") . LEM is the registered holder of a large-scale mining license 12848-HQ-LML issued in December 2014 for a period of 25 years which includes the world famous Kabwe Lead-Zinc-Silver-Vanadium mine in central Zambia ("Kabwe Mine") approx.110km north of the capital city of Lusaka.

On 24 May 2024 the Company announced that it had completed due diligence on the Kabwe Mine and was proposing to proceed with the acquisition of LEM. This work, included independent technical and legal reports, and demonstrated a technically robust and attractive acquisition opportunity of the Kabwe operation (the "Project") which has a long history of mining and processing operations (1904-1994) of base and precious metals. The Project's historical non-JORC compliant resources have been independently verified by the Company's retained technical experts Behre Dolbear meeting NI 43-101 reporting requirements and which have an in-situ value of approx. US$4 billion based on then prevailing London Metal Exchange prices. Preliminary economic analyses of the Project have estimated pre-tax cashflow of US$1.84 billion, NPV10 US$0.56 billion and an IRR of 112% based on the development of two of the five existing resources.

On the same date the Company was pleased to announce that it had entered a £2 million unsecured convertible loan note ("CLN") agreement with AUO. The availability of the CLN was extended in March 2025 for a period of 1 year to March 31^st 2026 and repayment / conversion also extended to March 31^st 2027. While AUO was previously unable to provide the requested funding, on behalf of AUO I can confirm that we remain committed to meeting its obligations under the CLN if required. The proceeds, if successfully drawn, will either be applied towards future acquisition opportunities, including LEM, or for general working capital purposes.

A conditional share purchase agreement ("SPA") was entered into between the Company and LEM in December 2024, to acquire 100% of LEM's share capital.

The Kabwe Mine, was previously operated by Anglo American plc and Zambia Consolidated Copper Mines Limited, and was mined continuously for 90 years until its closure in 1994, due to the then prevailing commodity prices. It was ranked as one of the world's highest-grade zinc and lead mining operations and is considered one of the most famous mines in Africa, holding a position of national economic importance in Zambia.

Subject to completion of the Acquisition and to securing the requisite funding, the Company will commence a 3-phase exploration and development program at the Kabwe Mine, as part of its plans to re-commence both open-pit and underground mining and processing operations.

2024 was certainly a challenging period for the Company on the ground from an operational perspective but outweighed by the strong steps taken to refocus the Company for the future. We believe that the continued and anticipated funding support by major shareholders, together with the investment strategy outlined above, will lead to a successful period for the business in 2025 and beyond.

I would like to extend my gratitude to all our stakeholders and former board directors and to Richard Lloyd for taking on the role of CEO and redirecting the Company with the conditional purchase of the Kabwe asset, planned restarting Rukwa and a successful secondary listing on the AltX exchange of the Johannesburg Stock Exchange ("JSE"). Thanks also goes to Jason Brewer, who stepped down during the period though of course remains as a consultant, for his contributions to the Company.

Yours Sincerely,

Quinton Van Der Burgh

Chairman

27 June 2025

CHIEF EXECUTIVE OFFICER'S REPORT

The past year, 2024, had a continued period of refocus for our Company and its future direction. The vision for further growth beyond coal, whilst maximizing the value of Rukwa continues. I only joined the Company at the very end of the reporting period so will focus on the initiatives that were in place and which I have been able to either complete or progress with the team. The focus for 2025 and beyond is key.

Board

I joined the board as the new CEO in December 2024 together with Edward Ruheni who joined as an NED, joining Marc Nally the Independent NED. Jason Brewer, whilst resigning as a Director, remains as a consultant through Gathoni Muchai Investments ("GMI") and has been extremely supportive both from the funding and strategic basis. The ongoing refocus of the Company has continued into the first half of 2025 with a further major strategic financial commitments to the Company by GMI, and the extension of the availability of the AUO Commercial Brokerage LLC ("AUO") convertible loan note by 12 months to March 2026.

I hope to make further board appointments with technical capabilities in order to progress our operations and strengthen the board.

In December 2024 Noel Lyons, Paul Ryan and Dr Allen Zimbler resigned as Directors of the company. As part of the settlement agreement Noel Lyons and Paul Ryan received £128,750 and £112,381 respectively in lieu of contractual notice period. Both were also awarded bonuses of £125,000 each. The company was grateful that £190,313.25 of the cash sum due to Noel Lyons and £178,036 of the cash sum due to Paul Ryan under their Settlement Agreements were paid by the issuance of 2,584,583 new Shuka Shares (the subscription price calculated using a 30 day VWAP) to Noel. Lyons and 2,417,850 new Shares to Paul Ryan. The majority of the cash balance has now been settled.

In addition Noel Lyons and Paul Ryan were awarded 2,000,000 warrants each and Dr Allen Zimbler was awarded 250,000 warrants (see Note 27).

Operations

The Rukwa coal mine in Tanzania, operated by Shuka owned subsidiary Edenville International Tanzania Limited ("EITL"), has faced challenges throughout the year, and has been managed on care and maintenance basis. However, a positive reassessment of the potential for the Rukwa mine as well as various joint venture discussions has resulted in a restart budget capex of c.USD150k in order to return the mine to a targeted production rate of 4,000-5,000 tpcm by Q3 2025, depending on when funding is secured. New equipment will be purchased or leased, the wash plant tested and restarted and sales will re- commence.

Strategic partnerships with large cement manufacturers continue to be discussed. There is interest in buying Rukwa's entire coal output, to a maximum 10,000 tonnes per month. EITL will need to prove its ability to produce a minimum of 4,000 tonnes per month uninterrupted. As mentioned this will require some investment in capital and equipment.

In February 2024, the Company signed a definitive settlement agreement with Upendo Group who hold a historic residual 10% interest in the Rukwa coal mining licence. The settlement granted an immediate payment to Upendo Group of USD 110,000. Upendo will also earn a royalty of $1.95 per tonne of coal from Rukwa sold. Positive conversations have continued in 2025 with the new board and Upendo regarding the operations restarting.

Kabwe / LEM acquisition

The Kabwe Mine, was previously operated by Anglo American plc and ZCCM from 1904-1994. It is one of the world's highest-grade zinc and lead mining operations and has also produced significant amounts of Silver and Vanadium oxide, and contains other rare earth minerals such as Gallium and Germanium. Early testing of surface samples from my recent visit returned grades of 15 to +30% Zn.

The Company completed due diligence on the Kabwe Mine and signed a conditional share purchase agreement ("SPA") with Leopard Exploration and Mining Ltd in December 2024 which is scheduled to complete no later than 30 June 2025. The SPA anticipates the acquisition of 100% of LEM's share capital. LEM is the registered holder of a large-scale mining license 12848-HQ-LML issued in December 2014 for a period of 25 years, covering the Kabwe Mine and surrounding area of 33sqkm.

Final authorisation has been approved by the Board of Commissioners of the Competition and Consumer Protection Commission ("CCCPC") for the acquisition of LEM.

The Company also agreed terms on a £1.5 million non-dilutive and unsecured facility, subject to completion of the Company's due diligence and signing of definitive funding documentation, to provide funding for the $1.35m balance of cash consideration due to the LEM vendors.

Following receipt of the final regulatory approval noted above, the Company has agreed the terms of an addendum to the SPA, subject to documentation, whereby the principal LEM vendors have agreed that the share consideration for the Acquisition, being $3.0 million, shall be settled on completion of the Acquisition through the issue of 28,640,042 new ordinary Shuka shares ("Consideration Shares"), with no deferred consideration shares, equivalent to an issue price of 7.737p per share (being a 10% discount to an agreed reference price of 8.5965p under the terms of the SPA), a significant premium to the current market price.

The Consideration Shares will represent, upon issue, 29.99% of the Company's enlarged issued share capital.

As compensation for the issuance of the Consideration Shares upon completion, with no deferred consideration shares, the Company has agreed to issue LEM with a further 2,000,000 warrants with an exercise price of 12.5p and expiry date of 31 December 2027, subject to the LEM vendors not holding post exercise, in aggregate, over 29.99% of the Total Voting Rights.

The Company have also met with and engaged GeoQuest and discussed its preliminary exploration plans and mine development strategy for the Kabwe Mine. GeoQuest is a fully independent geological and environmental consultancy and contract services group. GeoQuest's principals are well known by the Company's CEO and NED Marc Nally. As part of their initial phase of work they will complete a review of some of the historical resource drilling and exploration work completed at the Kabwe Mine and complete a geophysical survey of the Kabwe Mine and existing Mining License.

Behre Dolbear's NI 43-101 Competent Persons report is an extremely valuable starting point for the analysis of the Kabwe Mine. Preliminary economic analyses of the Project have estimated pre-tax cashflow of US$1.84 billion, NPV10 US$0.56 billion and an IRR of 112% based on the development of two of the five existing resources.

A 3-phase program, as recommended by Behre Dolbear, will comprise:

(i) a high-resolution geophysical survey,

(ii) a JORC Code 2012 resource drilling program, updated metallurgical test work and additional environmental and mining studies; and

(iii) detailed feasibility study work and underground mine refurbishment and new access decline activities as well as the establishment of new ore processing facilities and project value addition in respect of the production of refined metals products.

Funding

A funding commitment was entered into with GMI on 2 December 2024 for an unsecured, non-convertible, interest free loan of £500,000. The Company has agreed extended terms on an extra £1.5 million non-dilutive and unsecured facility, subject to completion of the Company's due diligence and signing of definitive funding documentation, in order to complete LEM acquisition (as noted above).

The £2m AUO Investments (Dubai) ("AUO") convertible loan note was extended by 12 months to March 2026, with repayment also extended 12 months to Marh 2027, which has also given the Company a possible further financing option. As previously announced, while the funding was not provided when requested in 2024, AUO has confirmed that it intends to honor its commitments under the CLN should it be called upon to do so.

The proceeds of the above facilities will be applied towards the cash element of the LEM acquisition, or other future acquisition opportunities, and for general working capital purposes.

The Company continues to assess the long outstanding debt owed by the Envirom Group with debt collectors in Norway and is evaluating the potential for a successful claim.

Corporate Social Responsibility

The Company remains committed to fulfilling its corporate and social responsibilities ("CSR"). We recognise the importance of meeting social requirements as an operator in Tanzania. The construction of the mining operation at Rukwa has already led to improvements in local infrastructure, most notably the construction and maintenance of a road from Kipandi to Mkomolo village and beyond, benefiting farmers, the local population, and the mine itself. We have also continued to prioritise the employment of local individuals from surrounding villages, resulting in highly competent and skilled employees. The positive social impact extends to the broader community, where enterprising individuals are providing services such as food supply for workers.

The CSR responsibilities in and around Kabwe with an historic, 100+ year old mine and local operations will be challenging but Shuka have already engaged local officials and representatives and will have a well thought out plan and study in place before any operations commence.

Post Period Events

In May 2024 the Company entered into a £2 million unsecured convertible loan note agreement ("CLN") with AUO Commercial Brokerage LLC ("AUO"), a wholly-owned subsidiary of Q Global Commodities Group ("QGC"), which is led by Quinton Van Den Burgh, the Company's Chairman. AUO has a current interest in 29.2% of the Company's issued shares.

On 4 April 2025 the availability of the entire principal amount was extended to 31 March 2026, including the drawdown date and redemption date was extended by 12 months to 31 March 2027.

The loan notes attract an interest of 3% per annum and are convertible at 15p per share at any time up to 31 March 2027.

On 7 May 2025, 1,625,000 new ordinary shares of 1p each were issued at a price of 8 pence per share in lieu of £130,000 of consultancy fees due to Gathoni Muchai Investments Limited, £70,000 of which were outstanding at the year end.

On 21 May 2025, the Company commenced its secondary listing on the AltX market of the Johannesburg Stock Exchange

On 11 June final authorization was approved by the CCCPC for the acquisition of LEM.

The Consideration Shares will represent, upon issue, 29.99% of the Company's enlarged issued share capital.

As compensation for the issuance of the Consideration Shares upon completion, with no deferred consideration shares, the Company has agreed to issue LEM[, following completion,] with a further 2,000,000 warrants with an exercise price of 12.5p and expiry date of 31 December 2027, subject to the LEM vendors not holding post exercise, in aggregate, over 29.99% of the Total Voting Rights.

Summary and Outlook

We have a new and focused executive management team with strong technical capabilities. Our investors bring extensive finance, and technical expertise in the mining business on the African continent. The LEM acquisition, once completed, and Kabwe project are huge milestone in Shuka's growth and a Company changer. Furthermore, with an expected improved cash and funding position, subject to completing funding, we will continue to target additional asset acquisitions, leveraging the natural resources and capital markets expertise of the Board and the significant shareholders.

I am firmly behind the future of Shuka and strongly believe that the future is bright, both for the remainder of 2025 and beyond, with confidence in its potential to generate shareholder value. The efforts made already in my short tenure have provided strong results and a positive share price trend. The JSE listing was a great success and opens the path to new and supportive investors.

Richard Lloyd

Chief Executive Officer

27 June 2025

REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF SHUKA MINERALS PLC

Opinion

We have audited the financial statements of Shuka Minerals Plc (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 December 2024 which comprise the Group Statement of Comprehensive Income, the Group and Parent Company Statement of Financial Position, the Group and Parent Company Statement of Changes in Equity, the Group and Parent Company Cash Flows Statements and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and UK-adopted international accounting standards and as regards the parent company financial statements, as applied in accordance with the provisions of the Companies Act 2006.

In our opinion:

· the financial statements give a true and fair view of the state of the group's and of the parent company's affairs as at 31 December 2024 and of the group's loss for the year then ended;

· the group financial statements have been properly prepared in accordance with UK-adopted international accounting standards;

· the parent company financial statements have been properly prepared in accordance with UK-adopted international accounting standards and as applied in accordance with the provisions of the Companies Act 2006; and

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

Basis for opinion

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

Material uncertainty related to going concern

We draw attention to note 2 in the financial statements, which highlights the need to re-commence commercial production at the Rukwa coal mine, uncertainty over renewal of the Rukwa mining licence which falls due for renewal in February 2026, and the need to access funds under the loan facilities within the going concern period to meet the cash consideration under the LEM acquisition and working capital requirements.

As stated in note 2, these events or conditions, along with the other matters as set forth in note 2, indicate that a material uncertainty exists that may cast significant doubt on the group's and company's ability to continue as a going concern. Our opinion is not modified in respect of this matter.

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. Our evaluation of the directors' assessment of the group's and company's ability to continue to adopt the going concern basis of accounting included

· Obtaining and evaluating management's going concern assessment, including their assumptions, key risks and uncertainties, and any available supporting documentation.

· Assessing the historical forecasting accuracy and consistency of the going concern assessment with information obtained from other areas of the audit, such as our audit procedures on management's impairment assessments.

· Testing the mathematical accuracy of the forecasts.

· Evaluating whether the assumptions made by management are reasonable and appropriately conservative, considering the group's principal risks and uncertainties. We challenged the assumptions and estimates made by management where necessary.

· Reviewing all available agreements and commitments in respect of the convertible loan note agreement and the non-convertible loan facility.

· Evaluating subsequent events impacting the going concern assessment.

· Evaluating the adequacy of working capital, including assessing the reasonableness of assumptions used in the cash flow forecasts and budgets and any plans to address potential shortfalls.

· Performing sensitivity analysis on management's assumptions, including applying incremental adverse cash flow sensitivities to assess the potential impact of severe but plausible scenarios such as significant movement in commodity prices or demand for coal, delays in re-commencing production and any other risks specific to the mining industry.

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

Emphasis of matter

Operationalisation of the 16% Government of Tanzania non-dilutable free carried share interest.

We draw attention to note 28 of the financial statements, which highlights that the Group has not completed the operationalisation of the issuance of the 16% non-dilutable free carried interest shares in its subsidiary, Edenville International (Tanzania) Limited, as required by the Tanzania State Participation Mining legislation.

Our opinion is not modified in this respect.

Our application of materiality

The quantitative and qualitative thresholds for materiality determine the scope of our audit and the nature, timing, and extent of our audit procedures. The materiality for the financial statements as a whole applied to the group financial statements was £90,000 (2023: £88,000) based on 1.5% of gross assets. We chose gross assets as the basis for materiality because in a mining company, the primary focus of users is the efficient utilisation and exploitation of mining assets to generate production, making it a key performance indicator for stakeholders. The performance materiality for the group was set at £58,000 (2023: £57,200) representing 65% (2023: 65%) of the overall materiality. The materiality for the financial statements as a whole applied to the parent company financial statements was £20,000 (2023: £22,000) based on 2% of expenses. We chose expenses as the basis for materiality for the parent company financial statements because it aligns with the key cost components associated with its administrative and management functions, considering the parent company primarily serves as a holding entity for the subsidiary. The performance materiality for the parent company was £13,000 (2023: £14,300) representing 65% (2023: 65%) of the overall materiality. Performance materiality is based at a medium to high risk level of 65% considering the inherent risks in the mining industry and the specific risks identified and disclosed in the key audit matters. We use performance materiality to reduce to an appropriately low level the probability that the aggregate of uncorrected and undetected misstatements exceeds overall materiality. Specifically, we use performance materiality in determining the scope of our audit and the nature and extent of our testing of account balances, classes of transactions and disclosures, for example in determining sample sizes.

For the component in the scope of our group audit, we allocated a materiality that was less than our overall group materiality. This component materiality, determined to be £58,000 (2023: £79,200), aligns with the same benchmarks used for the group.

We agreed with those charged with governance that we would report all differences identified during the course of our audit in excess of £4,000 (2023: £4,400) for the group and £1,000 (2023: £1,100) for the parent company.

Our approach to the audit

In designing our audit approach, we determined materiality and assessed the risks of material misstatement in the financial statements. In particular, we assessed the areas involving significant accounting estimates and judgements by the directors in respect of the carrying value of the mining assets and carrying values of the parent company's investments in, and loans to, subsidiaries and considered future events that are inherently uncertain. We also addressed the risk of management override of internal controls, including evaluation of whether there was evidence of bias by the directors that represented a risk of material misstatement due to fraud.

Of the four components of the group, two components being the London parent company and its Tanzanian subsidiary that holds the Rukwa mining license were identified as significant and material components. We performed a full scope audit of the London parent company's complete financial information using a team with specific experience of auditing mining entities and publicly listed entities, and the Tanzanian subsidiary's audit was conducted by component auditors from a PKF network firm. Specific procedures were performed in respect of the remaining components because they were not material to the group.

The subsidiary located in Tanzania was audited by a component auditor operating under our instructions as the group auditor. The Senior Statutory Auditor interacted regularly with the component audit team during all stages of the audit and was responsible for the scope and direction of the audit process. This, in conjunction with additional procedures performed, gave us appropriate evidence for our opinion on the group and parent company's financial statements.

Key audit matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial statements of the current period and include the most significant assessed risks of material misstatement (whether or not due to fraud) we identified, including those which had the greatest effect on: the overall audit strategy, the allocation of resources in the audit; and directing the efforts of the engagement team. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. In addition to the matters described in the Material uncertainty related to going concern section we have determined the matters described below to be the key audit matters to be communicated in our report.

Key Audit Matter	How our scope addressed this matter
Carrying value of mining assets (Note 15)
The entity has capitalised mining assets of £5,423,803 (2023: £5,334,949). As per IAS 36, management is required to assess the carrying value of these assets for impairment at each reporting date or when there is an indication of impairment. The impairment test involves estimation of the recoverable amount of the assets, which requires significant judgement and estimation uncertainty. Management's assessment of the carrying value of mining assets involves significant estimation and judgement related to the assumptions and inputs used in the NPV valuation model, together with the timing of re-commencing production activities to a commercial level. The carrying value of mining assets is a key audit matter because of the high level of estimation uncertainty and judgement involved in determining the carrying value of these assets reliably and accurately, the requirements of IAS 36 for the group to assess the carrying value of these assets for impairment, and the significance of these assets on the group's statement of financial position.	Our work in this area included: - Reviewing and challenging management's impairment review process, including consideration of the NPV calculations used, and reviewing the assumptions included in the models and performing a sensitivity analysis on the key assumptions. We challenged management's assumptions by testing against third-party evidence and ensuring the model is robust to these changes. - Examining the assumptions made in the impairment review and supporting calculations. We tested the reasonableness of the assumptions and compared them to industry benchmarks and other sources of external information. - Considering the Group's resources, coal processing capacity, and sales margins in our assessment of the carrying value of mining assets. We evaluated the potential impact of changes in market conditions, such as changes in commodity prices or demand, on the carrying value of mining assets. - Performing a sensitivity analysis to assess the impact of changes in key assumptions on the carrying value of mining assets. This helped us to assess the potential range of outcomes and the degree of estimation uncertainty associated with the carrying value of mining assets. - Reviewing the terms and conditions of the mining license agreement to determine the requirements for license renewal and assess whether Edenville International Tanzania has complied with these requirements. - Inquiring with the management regarding the steps taken to renew the mining license and assess the probability of renewal based on their responses. - Reviewing the correspondence and communication with relevant authorities to assess if there are any indications of non-compliance or breach of conditions that could affect the renewal of the mining license. - Ensuring that all mining licences are active and in good standing. - Assessing whether appropriate rehabilitation provisions have been recognized in the financial statements, considering the expiry of the mining license in 2026 and the potential costs associated with rehabilitation in the event that the license is not renewed. - Performing testing to ensure the existence and ownership of licenses and consideration has been given to whether a decommissioning provision is required. We evaluated the adequacy of the decommissioning provision, and assessed whether the decommissioning liability is appropriately recognized in the financial statements; and - Considering whether the treatment of mining assets is in accordance with IAS 16 and has been correctly classified. We evaluated the appropriateness of accounting policies used for mining assets, including the recognition and measurement of mineral reserves and mine development costs. The future carrying value of the mining assets is dependent on the ability of the subsidiary to re-commence production and fully realise the potential of the mine, together with the ability to increase the mining activities and extraction to pre-pandemic levels. The group has commenced discussions with the relevant authorities to renew the mining license, which falls due for renewal in February 2026. Refer to the observations within the key audit matter above in respect of the carrying value of mining assets.
Valuation of the parent company's investment in, and loans to, subsidiaries (Note 14)
The parent Company owns a significant investment in Edenville International (Tanzania) Limited of £18,460,461 (2023: £18,277,299), which includes loans to the subsidiary of £11,417,150 (2023: £11,233,987). The carrying value of this investment is linked to the value of the underlying assets held in Edenville International (Tanzania) Limited. These assets are primarily mining assets located in Tanzania, and their valuation is subject to significant estimation uncertainty and judgement. Therefore, there is a risk that the value in use of these assets is below the carrying value of the investment, which could result in material misstatement of the amounts reported. As per IAS 36 - Impairment of Assets, management is required to assess the recoverable amount of the mining assets held by Edenville International (Tanzania) Limited at each reporting date, or when there is an indication of impairment. This involves estimating the future cash flows expected to be generated from the mining assets and comparing this to the carrying value of the investment in the subsidiary. The estimation of future cash flows is based on assumptions made by management, including factors such as commodity prices, production volumes, and operational costs. The carrying value of the investment in Edenville International (Tanzania) Limited is a key audit matter due to the high level of judgement and estimation involved in determining the recoverable amount of the underlying mining assets.	Our work in this area included: - Reviewing and challenging management's impairment review of investments held, including consideration of the NPV calculations used. We reviewed the assumptions included in the models and performed a sensitivity analysis on the key assumptions. We challenged management's assumptions by testing against third-party evidence and ensuring the model is robust to these changes. We also considered the reasonableness of the discount rate applied in the NPV calculations. - Reviewing component auditor responses in relation to the Tanzania based subsidiary and evaluating the impairment indicators. We evaluated the work of the component auditor and assessed the accuracy and completeness of their audit work. We also reviewed the documentation provided by the component auditor to assess the existence of any impairment indicators. - Ensuring that all conditions related to mining license renewal and extensions are complied with. - Ensuring that mining licence with subsidiary are active and in good standing. - Reviewing the value of the net investment in subsidiaries against the underlying assets and verifying and corroborating the judgements/estimates used by management to assess the recoverability of investments and intercompany receivables. We assessed the reliability of the underlying assumptions made by management regarding the expected future cash flows from the mining assets held by the subsidiary. We also performed sensitivity analysis on the key assumptions used in the valuation and challenge management's estimates where necessary. Additionally, we corroborated the supporting documentation provided by management, such as mineral resource reports and feasibility studies, to assess the reasonableness of the judgements made. The future carrying value of the mining assets is dependent on the ability of the subsidiary to fully realise the potential of the mine and increase the mining activities and extraction to pre-pandemic levels.

Other information

The other information comprises the information included in the annual report, other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the group and parent company financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

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

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

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

Matters on which we are required to report by exception

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

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

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

· the parent company financial statements 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 group and parent company financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

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

Auditor's responsibilities for the audit of the financial statements

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

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

· We obtained an understanding of the group and parent company and the sector in which they operate to identify laws and regulations that could reasonably be expected to have a direct effect on the financial statements. We obtained our understanding in this regard through discussions with management, industry research, application of cumulative audit knowledge and experience of the sector.

· We determined the principal laws and regulations relevant to the group and parent company in this regard to be those arising from the Companies Act 2006, AIM Rules for Companies and Mining Act (14/2010) and various regulations made there under applicable to subsidiary in Tanzania.

· We designed our audit procedures to ensure the audit team considered whether there were any indications of non-compliance by the group and parent company with those laws and regulations. These procedures included, but were not limited to enquiries of management, review of minutes and Regulatory News Service (RNS) announcements, and review of legal and regulatory correspondence.

· We also identified the risks of material misstatement of the financial statements due to fraud. We considered, in addition to the non-rebuttable presumption of a risk of fraud arising from management override of controls, that the potential for management bias was identified in relation to the impairment assessment of mining assets and parent company's valuation of investments in loans to subsidiaries. We addressed this by challenging the assumptions and judgements made by management when evaluating any indicators of impairment.

· As in all of our audits, we addressed the risk of fraud arising from management override of controls by performing audit procedures which included, but were not limited to: the testing of journals; reviewing accounting estimates for evidence of bias; and evaluating the business rationale of any significant transactions that are unusual or outside the normal course of business.

· For the significant component within the group, the audit procedures performed by the component auditors relating to non-compliance with laws and regulations and the posting of journal entries was reviewed for evidence of non-compliance or potential instances of fraud detected. As noted in the Emphasis of matter section of our report, non-compliance with requirement of the Government of Tanzania on operationalisation of the 16% non-dilutable free carried interest shares was identified in the year.

Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.

Use of our report

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

David Thompson (Senior Statutory Auditor) 15 Westferry Circus

For and on behalf of PKF Littlejohn LLP Canary Wharf

Statutory Auditor London E14 4HD

27 June 2025

GROUP STATEMENT OF COMPREHENSIVE INCOME

	Note	2024	2023
		£	£
Revenue	5	2,305	194,346
Cost of sales		(200,566)	(438,877)

		(198,261)	(244,531)
Gross loss

Administration expenses	6	(1,799,584)	(1,424,120)



Group operating loss		(1,997,845)	(1,668,651)

Finance income	10	2,351	3,256
Finance costs	11	(9,433)	(16,133)


Loss on operations before taxation		(2,004,927)	(1,681,528)

Income tax	12	-	(972)


Loss for the year		(2,004,927)	(1,682,500)


Attributable to:
Equity holders of the Company		(2,003,219)	(1,680,848)
Non-controlling interest		(1,708)	(1,652)

Other comprehensive loss
Item that will or may be reclassified to the profit and loss:
Gain on translation of overseas subsidiary		90,521	(349,479)

Total comprehensive loss for the year		(1,914,406)	(2,031,979)

Attributable to:
Equity holders of the Company		(1,912,698)	(2,030,327)
Non-controlling interest		(1,708)	(1,652)

Earnings per Share (pence)

Basic and diluted loss per share	13	(3.32p)	(4.11p)

All operating income and operating gains and losses relate to continuing activities.

No separate statement of comprehensive income is provided as all income and expenditure is disclosed above.

View Full Financial Report HERE- https://www.shukaminerals.com/_files/ugd/2c63fe_95dc05135acc45d5bc3891566277ce8f.pdf

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