Atalaya Mining plc Annual Report 2022

← All annual reports

FY2022 Annual Report · Atalaya Mining plc

Loading PDF…

Atalaya Mining Plc

ANNUAL REPORT

FOR THE YEAR END 31 DECEMBER 2022

2 0 2 2

atalayamining.com

2 0 2 2
ANNUAL REPORT

FOR THE YEAR END 31 DECEMBER 2022

Atalaya Mining Plc

2 0 2 2

CONTENT

Company Overview

0 1

1.1 Our purpose

1.2 2022 Performance and Key Highlights

1.3 Strategic Focus for Growth

1.4 Atalaya at a Glance

1.5 Letter from the Chair

1.6 Key Performance Indicators

0 2

Management Report

2.1 Basis of Reporting

2.2 Operational Review

2.3 Financial Review

2.4 Other Matters

2.5 Principal Risks and Uncertainties

Directors’ and Officers’ Statement

Strategic Report

4.1 Market Overview

4.2 Strategic Framework

Sustainability Report

0 3

0 4

0 5

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

5.1 Our Commitment to Sustainability

5.2 Good Governance and Responsible Management

5.3 People

5.4 Safe Operations

5.5 Environment and Climate Change

5.6 Society

5.7 Innovation and technology

0 6

0 7

Corporate Governance Report

6.1 Board of Directors

6.2. Board Committees

Consolidated and Company Financial Statements

7.1 Independent Auditor’s Report

7.2 Consolidated and Company Financial Statements

7.3 Notes to the Consolidated and Company Financial Statements

0 8

Shareholder Information

8.1 Glossary of Terms

8.2 Shareholder Enquiries

102

110

168

166

170

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

2022 Annual Report

0 1

Company
Overview

Atalaya Mining Plc

CONTENT 01:

1 . 1

Our purpose

1 . 2

2022 Performance and Key Highlights

1 . 3

Strategic Focus for Growth

1 . 4

Atalaya at a Glance

1 . 5

Letter from the Chair

1 . 6

Key Performance Indicators

Company Overview

Our purpose

1.1

Our purpose

Our
Strategy

Operational Expertise that Delivers

Atalaya Mining continues to build on its success
at Proyecto Riotinto, increasing production and
capacity, with a view to becoming a multi-asset
producer. It maintains a focus on the develop-
ment of sustainable, scalable and low-risk assets
in mining-favourable jurisdictions.

Our
Mission

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

Responsibly Increasing Long Term
Value for All Stakeholders

Atalaya Mining implements its strategic objec-
tives to ensure the ongoing stable growth of the
Company. Protecting and enhancing the value for
all stakeholders is of paramount importance, and
the Company continuously looks at opportunities to
achieve this.

The Company seeks to provide society with the
essential raw materials required for economic
growth and the energy transition.

Atalaya Mining is focused on conducting respon-
sible mining that positively impacts local communi-
ties, the environment and all our stakeholders.

Our
Values

A Committed Duty to a Safe and
Ethical Working Environment

Atalaya Mining is committed to responsible mining
and upholds its core principles of honesty and
accountability. The Company works with all stake-
holders to ensure that its values are completely
aligned with the local community and environment.

Atalaya Mining Plc.

2022 Performance and Key Highlights

Company Overview

1.2

2022 Performance
and Key Highlights

Operational Highlights

2 0 2 3

2 0 2 2

2 0 2 1

Unit

Guidance

Actual

Copper
concentrate

Copper contained
in concentrate

Payable copper
contained in
concentrate

249,543

270,713

53,000-
55,000

52,269

56,097

49,773

53,390

Full year 2022
copper production
of 52,269.

Annual ore
processed in 2022
was 15.4 million t

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

Financial Highlights

Unit

2 0 2 2

2 0 2 1

Revenues

€k

361,846

405,717

EBITDA

€k

55,314

199,114

Dividend per
share (1)

$/share

0.0745

0.395

Cash cost

$/lb
payable

3.16

2.18

All-in sustaining
cost (AISC)

$/lb
payable

3.37

2.48

Net cash position

€k

53,085

60,073

Cash at bank

€k

126,448

107,517

Atalaya Mining Plc.

EBITDA of €55.3
million in 2022.

Cash costs of
US$3.16/lb and AISC
of US$3.37/lb.

Healthy liquidity
position with €126.4
million cash at bank
at 31 December
2022.

Final Dividend of
$0.0385 per ordinary
share proposed,
bringing Full Year
Dividend to $0.0745
per ordinary share.

(1) 2022 consists
of Interim Divi-
dend (paid 30
September 2022)
and proposed Final
Dividend (subject
to approval at 2023
AGM); 2021 repre-
sents Inaugural
Dividend paid 1
December 2021.

Company Overview

Strategic Focus for Growth

1.3

Strategic Focus for Growth

Atalaya’s ambition is to become a multi-asset, mid-tier base metals
producer.

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

Organic Growth

Value-added products

» Evaluation of technologies (E-LIX) to

maximise value of complex sulphides
at Riotinto and in the Iberian Pyrite

Belt.

Advance Atalaya’s existing higher
grade brownfield orebodies, including
San Dionisio and San Antonio into
production

» Potential uplift of copper production.

Increases optionality, production and
mine life.

Cost reduction / ESG initiatives

» Solar project reduces operating costs

and carbon emissions.

» Zero tailings water discharge design

is international best practice.

External Growth

Proyecto Touro

We continue to be confident that our
world class approach to Proyecto Touro
will satisfy the most stringent environ-
mental conditions that may be imposed
by the authorities prior to the develop-
ment of the project.

Proyecto Masa Valverde

Following the acquisition of Masa
Valverde in October 2020, work has
started on general permitting new
geophysical surveys, and exploration
drilling at the polymetallic project
located in Huelva (Spain), one of the
largest undeveloped volcanogenic
massive sulphide deposits in the Iberian
Pyrite Belt.

Proyecto Ossa Morena

The Ossa-Morena Metallogenic Belt has
strong exploration potential for a range
of base and precious metals and is north
of the Iberian Pyrite Belt where Atalaya
operates its flagship Proyecto Riotinto
mine.

Continue to evaluate external oppor-
tunities that leverage core capabilities

» New prospects in the Iberian

Pyrite Belt or other safe mining
jurisdictions.

» Targeting prospects of material scale,
good geology & upside potential via
rigorous technical due diligence.

Atalaya Mining Plc.

Atalaya at a Glance

Company Overview

1.4

Atalaya at a Glance

Atalaya is an AIM listed mining and development group that produces
copper concentrates including silver by-product at its wholly owned Proyecto
Riotinto site in southwest Spain. Key qualities of the Company include:

Assets located in established and stable
mining jurisdictions

Pipeline of potential growth opportunities

Proven management team

Strong focus on ESG

Robust balance sheet

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

The Company owns and operates through a wholly
owned subsidiary, “Proyecto Riotinto”, an open-pit
copper mine located in the Iberian Pyrite Belt, in
the Andalusia region of Spain, approximately 65 km
northwest of Seville. A brownfield expansion was
completed in 2019. Atalaya also owns 10% of Proyecto
Touro, a brownfield copper project in northwest Spain
and 100% of Proyecto Masa Valverde, a polymetallic
project located in Huelva (Spain) and 28 km southwest
of Proyecto Riotinto.

The Company’s and its subsidiaries’ business is to
explore for and develop metal production operations
in Europe, with a primary focus on copper.

The strategy is to evaluate and prioritise metal produc-
tion opportunities in several jurisdictions throughout
the well-known belts of base and precious metal miner-
alisation in Spain, Europe and Latin America. For further
details on the principal activities of the Group and the
Company, please refer to www.atalayamining.com.

Atalaya Mining Plc.

Company Overview

Atalaya at a Glance

Cerro Colorado (Proyecto Riotinto)

Ownership

Mine Activity

Commodity

Location

Ore Reserve*

Resources

2022
actual Cu
production

100%

Open pit
mining in
operation

Cu, Ag

Huelva,
Spain

185 Mt at
0.38% Cu
(P&P)

200.7 Mt at
0.37% Cu (M&I)

52,269t

* Reserve update as at December 2020 and announced in June 2021.

San Dionisio / San Antonio (Proyecto Riotinto)

Ownership

Mine
Activity

Commodity

Location

Ore
Reserve

M& I&I Resources*

Growth

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

100%

Potential for
open pit and
underground
mining

Cu, Zn, Pb

Huelva,
Spain

Potential
to increase
production
by increasing
head grade

San Dionisio open pit:

56.1 Mt at 0.91% Cu and
1.14% Zn (M&I)

San Dionisio underground:

12.4 Mt at 1.01% Cu and
2.54% Zn (Inferred)

San Antonio underground:

11.8 Mt at 1.32% Cu and
1.79% Zn (Inferred)

* NI 43-101 compliant resource estimate as announced in April 2022

Proyecto Riotinto is operated through Atalaya Riotinto Minera, S.L.U. a fully owned entity established under the
laws of Spain.

Atalaya at a Glance

Company Overview

Proyecto Masa Valverde (Riotinto District)

Ownership

Mine
Activity

100%

Potential for
under-
ground
mining. In
the permit-
ting stage

Commodity

Location

Resources*

Growth

Cu, Zn, Pb,
Ag and Au

Huelva,
Spain

Masa Valverde:

16.9 Mt at 0.66% Cu, 1.55% Zn
and 0.65% Pb (Indicated)

73.4 Mt at 0.61% Cu, 1.24% Zn
and 0.61% Pb (Inferred)

Majadales:

3.1 Mt at 0.94% Cu, 3.08% Zn
and 1.43% Pb (Inferred)

Strong exploration
upside potential
in the immediate
surroundings. Recent
potential discovery of
polymetallic massive
sulphide

* NI 43-101 resource estimate as announced in April 2022

In 2020, Atalaya entered into a definitive purchase agreement to acquire the Masa Valverde polymetallic project in
Huelva. The mining rights are owned by Atalaya Masa Valverde, S.L.U. a fully owned subsidiary of Atalaya.

Proyecto Touro

Ownership

Mine Activity

Commodity

Location

Ore Reserve*

10% with
an earn-in
agreement up
to 80%

Open pit
mining in
permitting
stage

Cu, Ag

A Coruña,
Spain

90.9 Mt at
0.43% Cu
(P&P)

M, I&I
Resources*

Growth

129.9 Mt at
0.39% Cu (M&I)
and 46.5 Mt
at 0.37% Cu
(Inferred)

Option to
acquire
100% of the
adjacent
exploration
concessions

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

* NI 43-101 technical report dated April 2018

In 2017, Atalaya signed a phased, earn-in agreement for up to 80% ownership of Proyecto Touro, a brownfield
copper project in northwest Spain. The mining rights are owned by Cobre San Rafael, S.L.

Proyecto Ossa Morena

Ownership

Mine
Activity

99.9%

Open pit
mining in
exploration
stage

* Historical data

Commodity

Location

Resources*

Growth

Cu, Au and
Fe

Huelva,
Spain

Alconchel:

7.8 Mt at 0.66% Cu and 0.17 g/t
Au (M&I) and 15.0 Mt at 0.47%
Cu and 0.14 g/t Au (Inferred)

Strong exploration
upside potential
in the immediate
surroundings.

1.5

Company Overview

Letter from the Chair

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

Dear Shareholder,

The year of 2022 presented a
number of external challenges,
although these were very
different from those experienced
in 2020 and 2021, where Covid-19
affected everyone. We started
2022 with a positive outlook, with
the pandemic in rapid decline
and economies all over the world
picking up speed. This feeling of
euphoria quickly subsided with
the events in the Ukraine in late
February 2022, which immedi-
ately impacted the European and
global energy markets. Severe
spikes in natural gas prices in
Europe pushed electricity prices
in Spain to over €500/MWh in
March 2022 and similar levels in
late August and early September
2022, with average realised prices
for Q3 2022 reaching around
€290/MWh.

The year was dominated by
geopolitical and macroeconomic
factors, but for the most part, our
operations performed well. The
Company continued its good
track record, with copper produc-
tion totalling 52,300 tonnes in
2022, compared to 56,100 in 2021.
The slight reduction in produc-
tion was a result of lower grades
and lower throughput. The plant
performed solidly throughout the
year despite the negative impact
of the Q1 2022 transport sector
strike and related stoppage.

The average process plant feed
grade of 0.40% copper and the

process recovery rate of approxi-
mately 86% were consistent with
reserve estimates and budgeted
figures. Cash Costs and All-in
Sustaining Costs for 2022 of $3.16/
lb and $3.37/lb respectively, were
on the upper end of the guid-
ance provided for the year. This
was mainly due to the increase
in electricity costs and other
supplies and lower production
volumes, partially offset by the
weaker Euro. The strong oper-
ating performance shown in the
latter part of 2022 has continued
into 2023, with the plant main-
taining throughput above
nameplate capacity. Accordingly,
copper production guidance
for 2023 remains as previously
announced, in the range of
53,000 to 55,000 tonnes.

Despite the solid operational
performance during 2022, reve-
nues for 2022 were €361.8 million,
compared to €405.7 million in
2021. The reduction was due to
lower production volumes and
a lower average realised copper
price. EBITDA for 2022 was €55.3
million, compared to €199.1
million in 2021. The EBITDA was
significantly affected by the
inflationary environment globally
and mainly due to the increase
in electricity costs during 2022
of around €64 million. On a
more positive note, as a result
of the electricity price so far in
2023 and the benefits from two
key company specific electricity
procurement initiatives, we are
optimistic on the outlook for

Roger Davey

Chair of Atalaya Mining Plc

overall electricity costs for 2023
and beyond, with the relevant
knock-on positive effect on the
profitability. The long-term
power purchase agreement
(“PPA”) took effect at the start
of 2023. The 10-year agreement
will provide the Company with
approximately 31% of its current
electricity requirements at a
fixed rate that is over 75% lower
than the estimated average
realised electricity price in 2022,
and also below the rates realised
in 2021. The Company continues
to advance construction of its
50 MW solar plant at Riotinto,
which is expected to provide

Atalaya Mining Plc.

Letter from the Chair

Company Overview

“ The year was dominated by
geopolitical and macroeconomic factors,
but for the most part, our operations
performed well.”

approximately 22% of its current
electricity needs when fully oper-
ational in late 2023. Combined,
the 50 MW solar plant and long-
term PPA will provide over 50% of
the Company’s current electricity
requirements at a rate below
historical prices in Spain. The
Company continues to evaluate
additional renewable power
initiatives that could deliver
further low cost and carbon-free
electricity for its operations at
Riotinto, including wind turbines.

For additional growth pros-
pects the Company is currently
focusing on five main projects.
The Company remains fully
committed to the development
of the Touro copper project in
Galicia, in the north of Spain.
Running parallel with the
permitting process, the Company
is focused on a number of
initiatives relating to securing
the social licence, including
engaging with the many stake-
holders in the region in advance
of its plans to submit a new
improved project design. In the
south, at Proyecto Masa Valverde,
exploration work is ongoing, with
three core rigs continuing to be
active, with encouraging drilling
results. Drill target definition
continues to progress and the
first drill testing is planned at
Riotinto East. Two short drilling
programmes were completed
at the Hinchona and Chaparral
copper-gold projects at Proyecto
Ossa Morena.

Finally, in February 2023, the
Company announced the
completion of a new prelimi-
nary economic assessment for
Proyecto Riotinto that contem-
plates a new integrated mine
plan for Cerro Colorado, San
Dionisio and San Antonio, which
has the potential to increase
copper production by increasing
the blended head grade
processed at Riotinto’s 15 Mtpa
plant.

The Company continues to
advance construction of the
E-LIX Phase I plant. In recent
weeks, activities have included
the completion of most civil and
structural work, with equipment
now being assembled. Commis-
sioning of the plant is expected
in H2 2023. Once operational,
the E-LIX plant is expected to
produce high purity copper or
zinc metals on site, allowing the
Company to potentially achieve
higher metal recoveries from
complex polymetallic ores, lower
transportation and concen-
trate treatment charges and a
reduced carbon footprint.

Our balance sheet remains
strong and this allows the
Company to continue to invest
in growth and cost reduction
initiatives, including E-LIX,
higher-grade orebodies and
exploration across our portfolio.
In addition, our financial strength
means we are well positioned to
develop Touro should approvals
be granted, which could become

a new source of copper produc-
tion in Europe.

I would like to thank Harry Liu,
who stepped down from our
board following a long period
of service, and also welcome
Kate Harcourt to the Company’s
board. Kate has immense exper-
tise in sustainability and we look
forward to publishing our second
sustainability report for 2022.

I would like to take this opportu-
nity to express our appreciation
for the continued dedication and
commitment of the manage-
ment and staff. At the same
time, I would like to thank not
only the board members for their
continued support, guidance,
and close involvement with the
Company activities, but also our
valued shareholders for their
continued and appreciated
support.

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

Roger Davey

Chair of Atalaya Mining Plc

21 March 2023

Atalaya Mining Plc.

Company Overview

Key Performance Indicators

1.6

Key Performance Indicators

Ore mined (t)

2018

2019

2020

2021

2022

10,753,598

10,366,903

13,604,801

13,535,470

14,884,361

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

5,000,000

10,000,000

15,000,000

Ore processed (t)

2018

2019

2020

2021

2022

9,819,839

10,453,116

14,833,916

15,822,610

15,410,459

5,000,000

10,000,000

15,000,000

Copper contained in concentrate (t)

2018

2019

2020

2021

2022

42,114

44,950

55,890

56,097

52,269

20,000

40,000

60,000

Key Performance Indicators

Company Overview

Cash cost ($/lb)

4.00

3.00

2.00

1.00

0.00

AISC ($/lb)

4.00

3.00

2.00

1.00

0.00

1.94

1.80

1.95

2.18

2018

2019

2020

2021

2022

2.26

2.14

2.21

2.48

3.16

3.37

2018

2019

2020

2021

2022

Realised copper price (excl. QPs) ($/lb)

5.00

4.00

3.00

2.00

1.00

0.00

2.89

2.73

2.78

4.22

3.96

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

2018

2019

2020

2021

2022

EBITDA (€`000)

Working Capital surplus / (deficit) (€`000)

2018

2019

2020

2021

2022

53,542

61,333

67,444

55,314

8,435

3,598

(17,904)

199,114

102,430

84,047

Cash at bank (€`000)

Net cash position (€`000)

33,070

8,077

37,767

2018

2019

2020

2021

2022

53,542

8,077

(15,233)

107,517

126,448

60,073

53,085

Atalaya Mining Plc.

2022 Annual Report

0 2

Management
Report

Atalaya Mining Plc

CONTENT 02:

2 . 1

Basis of Reporting

2 . 2

Operational Review

2 . 3

Financial Review

2 . 4

Other Matters

2 . 5

Principal Risks and Uncertainties

Management Report

Basis of Reporting

2.1

Basis of Reporting

The Board of Directors of Atalaya Mining Plc (the “Company”
or “Atalaya”) presents its Group’s and Company’s Manage-
ment Report together with the audited consolidated finan-
cial statements (hereinafter “financial statements”) of the
Company and its subsidiaries (the “Group”) and the separate
financial statements of the Company for the year ended
31 December 2022. These documents can be found on the
Atalaya website at www.atalayamining.com.

The Company is a Cypriot incorporated public company
with a primary listing on AIM of the London Stock Exchange.
The Group’s and Company’s financial statements have
been prepared in accordance with International Financial
Reporting Standards (“IFRS”) as adopted by the European
Union and the requirements of the Cyprus Companies Law,
Cap.113. For the year ending 31 December 2022, the stand-
ards applicable for IFRS’s as adopted by the EU are aligned
with the IFRS’s as issued by the IASB. The currency referred
to in this document is the Euro (“EUR”), unless otherwise
specified.

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

Basis of Reporting

Management Report

Introduction

This report provides an overview and anal-
ysis of the financial results of operations of
the Group, to enable the reader to assess
material changes in the financial posi-
tion between 31 December 2021 and 31
December 2022 and the results of opera-
tions for the twelve month periods ended 31
December 2021 and 31 December 2022.

Forward Looking
Statements

This report may include certain “forward-looking state-
ments” and “forward-looking information” applicable
under securities laws. Except for statements of historical
fact, certain information contained herein constitutes
forward-looking statements. Forward-looking state-
ments are frequently characterised by words such as
“plan”, “expect”, “project”, “intend”, “believe”, “anticipate”,
“estimate”, and other similar words, or statements
that certain events or conditions “may” or “will” occur.
Forward-looking statements are based on the opin-
ions and estimates of management at the date the
statements are made and are based on a number of
assumptions and subject to a variety of risks and uncer-
tainties and other factors that could cause actual events
or results to differ materially from those projected in the
forward-looking statements. Assumptions upon which
such forward-looking statements are based include
all required third party regulatory and governmental

approvals that will be
obtained. Many of these
assumptions are based
on factors and events
that are not within the
control of Atalaya and
there is no assurance
they will be correct.
Factors that cause
actual results to vary
materially from results
anticipated by such
forward-looking state-
ments include changes
in market conditions
and other risk factors
discussed or referred to
in this report and other
documents filed with
the applicable securities
regulatory authorities.

Although Atalaya has attempted to identify important
factors that could cause actual actions, events or results
to differ materially from those described in forward-
looking statements, there may be other factors that
cause actions, events or results not to be anticipated,
estimated or intended. There can be no assurance that
forward-looking statements will prove to be accurate,
as actual results and future events could differ materi-
ally from those anticipated in such statements. Atalaya
undertakes no obligation to update forward-looking
statements if circumstances or management’s esti-
mates or opinions should change except as required by
applicable securities laws. The reader is cautioned not
to place undue reliance on forward-looking statements.

Alternative Performance Measures

Atalaya has included certain non-IFRS measures
including “EBITDA”, “Cash Cost per pound of payable
copper” “All In Sustaining Costs” (“AISC”) and “realised
prices” in this report. Non-IFRS measures do not have
any standardised meaning prescribed under IFRS, and
therefore they may not be comparable to similar meas-
ures presented by other companies. These measures are
intended to provide additional information and should
not be considered in isolation or as a substitute for indi-
cators prepared in accordance with IFRS.

EBITDA includes gross sales net of penalties and
discounts and all operating costs, excluding finance,
tax, impairment, depreciation and amortisation
expenses.

Cash Cost per pound of payable copper includes
on-site cash operating costs, and off-site costs
including treatment and refining charges (“TC/RC”),
freight and distribution costs net of by-product credits.
Cash Cost per pound of payable copper is consistent
with the widely accepted industry standard estab-
lished by Wood Mackenzie and is also known as the
cash cost.

AISC per pound of payable copper includes the Cash
Costs plus royalties and agency fees, expenditure
on rehabilitations, stripping costs, exploration and
geology costs, corporate costs, and sustaining capital
expenditures.

Realised prices per pound of payable copper is the
value of the copper payable included in the concen-
trate produced including the discounts and other
features governed by the offtake agreements of the
Group and all discounts or premiums provided in
commodity hedge agreements with financial institu-
tions, expressed in USD per pound of payable copper.
Realised price is consistent with the widely accepted
industry standard definition.

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

Atalaya Mining Plc.

Management Report

Operational Review

2.2

Operational Review

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

Proyecto Riotinto

The following table presents a summarised statement of operations of Proyecto Riotinto for the twelve and three
month period ended 31 December 2022 and 2021.

Unit*

Q4 2022

Q4 2021

FY2022

FY2021

Ore mined

Waste mined

Ore processed

Copper ore grade

Copper concentrate grade

Copper recovery rate

Copper concentrate

Copper contained in concentrate

Payable copper contained in concentrate

Cash cost

All-in sustaining cost

US$/lb payable

3,540,155

3,494,222

14,884,361

13,535,470

5,329,252

7,287,352

24,661,569

30,533,174

3,958,654

3,846,559

15,410,459

15,822,610

0.41

20.27

86.24

0.41

21.44

87.04

0.40

20.95

85.84

0.41

20.72

85.97

68,908

64,695

249,543

270,713

13,969

13,280

2.90

3.12

13,872

13,225

2.24

2.46

52,269

49,773

3.16

3.37

56,097

53,390

2.18

2.48

There may be slight differences between the numbers in the above table and the figures announced in the quarterly
operations updates that are available on Atalaya’s website at www.atalayamining.com

* Units expressed in accordance with the international system of units (SI)

Atalaya Mining Plc.

Operational Review

Management Report

$/lb Cu payable

Q4 2022

Q4 2021

FY2022

FY2021

Mining

Processing

Other site operating costs

Total site operating costs

By-product credits

Freight, treatment charges and other offsite costs

Total offsite costs

Cash costs

Corporate costs

Sustaining capital (excluding one-off tailings expansion)

Capitalised stripping costs

Other costs

Total AISC

0.70

1.11

0.59

2.40

0.67

0.56

0.61

1.83

0.79

1.31

0.54

2.65

0.64

0.61

0.54

1.79

(0.07)

(0.08)

(0.09)

0.57

0.50

2.90

0.09

0.06

0.08

3.12

0.48

0.40

2.24

0.05

0.06

2.46

0.60

0.52

3.16

0.08

0.06

0.01

0.06

3.37

0.49

0.39

2.18

0.07

0.06

0.10

0.07

2.48

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

Mining and Processing

Mining

The amount of ore mined during Q4 2022 was 3.5
million tonnes, which is in line with the same period in
2021. Overall, for the entire fiscal year of 2022 and the
amount of ore mined was 14.9 million tonnes, which
is an increase from the previous fiscal year, which saw
13.5 million tonnes of ore mined.

Waste mined was 5.3 million tonnes in Q4 2022 (Q4
2021: 7.3 million tonnes) and 24.7 million tonnes in
FY2022 (FY2021: 30.5 million tonnes).

Processing

The plant processed ore of 4.0 million tonnes during
Q4 2022 (Q4 2021: 3.8 million tonnes). Throughput
was 15.4 million tonnes in FY2022 (FY2021: 15.8 million
tonnes), demonstrating strong plant performance
despite the negative impact of the Q1 2022 trans-
port sector strike and related stoppage. The plant
continues to demonstrate its ability to operate above
its 15 million tonne per annum nameplate capacity.

Copper grade was 0.41% in Q4 2022 (Q4 2021: 0.41%).
Copper grade was 0.40% in FY2022 (FY2021: 0.41%).
Lower grades in FY2022 were the result of blending
with lower grade stockpiles during H1 2022 due to pit
sequencing.

Copper recoveries were 86.24% in Q4 2022 (Q4 2021:
87.04%) and 85.85% in FY2022 (FY2021: 85.97%).

Concentrate production for 2022 was 249,543 tonnes
compared to 270,713 tonnes in 2021. Contained copper
was 52,269 tonnes compared to 56,097 tonnes in 2021.
Copper payable amounted to 49,773 tonnes from
53,390 tonnes in 2021. Lower production for FY2022
was the result of lower grades (pit sequencing) and
lower throughput (including the impact of the Q1 2022
plant maintenance stoppage).

On-site concentrate inventories at 31 December 2022
were approximately 3,529 tonnes (5,254 tonnes at 31
December 2021) which have been fully sold in January
2023. All concentrate in stock was delivered to the port
at Huelva.

Proyecto Riotinto

On 23 February 2023, the Company announced the
results of a new preliminary economic assessment
for the Cerro Colorado, San Dionisio and San Antonio
deposits at Proyecto Riotinto (“Riotinto PEA”). The
objective of the Riotinto PEA was to incorporate these
deposits into a new integrated mine plan in order
to quantify the benefits of the Company’s planned
processing hub strategy for its 15 Mtpa processing plant.

The Riotinto PEA demonstrated strong potential
economic results, including a $1.07 billion after-tax
NPV(8%) at $3.50/lb copper (Base Case) and a $1.57
billion after-tax NPV(8%) at $4.03/lb copper (Sensitivity
Case). In addition, the Riotinto PEA illustrated the poten-
tial uplift in copper equivalent production to ~90 ktpa
(2027+) as a result of processing higher grade material,
as well as a potential reduction in cash costs.

Atalaya Mining Plc.

Management Report

Operational Review

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

The Riotinto PEA serves as a foundation for further
optimisation and the Company will continue to
evaluate opportunities to enhance value, including
the potential application of the E-LIX System, consid-
ering a revised mining sequence to bring forward the
highest value material and studying the refurbish-
ment of existing processing equipment at Riotinto in
order to reduce the capital costs associated with plant
modifications.

E-LIX Phase I Plant

Construction activities at the E-LIX Phase I plant
continue to make good progress. With most equip-
ment on site or in transit, commissioning activities are
now expected in H2 2023.

Once operational, the E-LIX plant is expected to
produce high purity copper or zinc metals on site,
allowing the Company to potentially achieve higher
metal recoveries from complex polymetallic ores,
lower transportation and concentrate treatment
charges and a reduced carbon footprint.

Riotinto District
– Proyecto Masa
Valverde

Three core rigs continue to be active and are focused on
step-out drilling at the Masa Valverde deposit, resource
definition drilling at the Campanario Trend and step out
drilling around the new discovery made at the Mojarra
Trend. A comprehensive update on recent exploration
results at these targets was announced in November
2022.

The second hole (MR02) drilled at the Mojarra Trend,
in a previously undrilled area, intersected massive
sulphides at 434m depth. Assay results returned a
main mineralised interval of 18.75m at 0.84% Cu, 0.63%
Zn, 0.66% Pb and 76.24 g/t Ag including a high-
er-grade interval of 6.80m at 1.22% Cu and 101.60 g/t
Ag.

Step-out drilling in the westernmost area of the Masa
Valverde deposit discovered a new high-grade zinc
zone in hole MJ54, including a main mineralised
interval of 18.00m at 0.25% Cu, 8.30% Zn, 2.49% Pb,
60.17 g/t Ag and 0.89 g/t Au from 852 meters depth.

Resource definition drilling at the Campanario
Trend continues to encounter shallow, massive, and
semi-massive sulphides with, in cases, associated high

grade intersections. For example, hole CA42 in the
western part of the Campanario Trend assayed 7.50m
at 0.45% Cu, 1.09 g/t Ag and 6.67 g/t Au from 35m
depth.

An airborne gravity gradiometry (“AGG”) and magnetic
survey covering the entire PMV has been completed
and preliminary results already received. AGG is a
leading technology in the search for buried mineral
deposits, especially those of the size that is typical in
the Iberian Pyrite Belt.

Work continues on the PEA which will consider oper-
ating PMV as a satellite deposit by processing mined
material at Riotinto’s 15 Mtpa plant. Further metal-
lurgical testing for the Masa Valverde and Majadales
deposits is planned for inclusion in the PEA, which
may also include new results from the regional drilling
programme. The permitting process for PMV is also
ongoing.

Proyecto Touro

Atalaya remains fully committed to the develop-
ment of the Touro copper project in Galicia, which
could become a new source of copper production for
Europe.

In March 2023, the European Union announced the
Critical Raw Materials Act, which seeks to “address the
EU’s dependency on imported critical raw materials
by diversifying and securing a domestic and sustain-
able supply of critical raw materials”. Copper was
added to the list of “Strategic Raw Materials” as a
result of the challenges associated with substituting
copper metal in electrical applications.

Running parallel with the Touro permitting process,
the Company continues to focus on numerous initia-
tives related to securing the social licence, including
engaging with the many stakeholders in the region
in advance of its plans to submit a new improved
project design. Positive and favourable feedback from
numerous meetings with municipalities, farmer and
fishermen associations and other industries indicate
meaningful support towards the development of a
new and modern mining project.

The Company is operating its new water treatment
plant at Touro, which is addressing the legacy issues
associated with acid water runoff from the historical
mine, which closed in 1987. The construction of the
treatment plant was contemplated in the original
project proposal, but Atalaya volunteered to fix the
historical acid water issues prior to the new Environ-
mental Impact Assessment (“EIA”) in order to demon-
strate its operating philosophy and the benefits of

Atalaya Mining Plc.

Operational Review

Management Report

modern operating systems. The field work carried out
by Atalaya has resulted in an immediate and visible
improvement of the water systems surrounding the
project.

Atalaya continues to be confident that its approach
to Touro, which includes fully plastic lined thickened
tailings with zero discharge, is consistent with interna-
tional best practice and will satisfy the most stringent
environmental conditions that may be imposed by the
authorities prior to the development of the project.

announced in November 2022. The best results were
in the southernmost hole, HIN04, with several miner-
alised intervals such as 14.95m at 0.29% Cu from
239.35m depth and including two higher-grade inter-
vals of 3.40m at 0.80% Cu, 1.84 g/t Ag and 479 ppm Co
and 1.45m at 1.01% Cu and 6.04 g/t Ag.

At Chaparral, four holes totalling 1,185m were
completed and results will be published once the
exploration campaign is completed. Drilling at the
flagship Alconchel-Pallares copper-gold project is
expected to commence during Q3 2023.

Proyecto Ossa Morena

Two short drilling programmes were completed at the
Hinchona and Chaparral copper-gold prospects, which
are both located in the central part of the district.
A second drilling program at Chaparral is currently
in progress. Drilling has been also planned for the
Guijarro gold project located immediately west of
Chaparral.

At Hinchona, four holes totalling 1,874m were
completed, with the initial results previously

Riotinto District –
Proyecto Riotinto East

Drill target definition continues to progress and the
first drill testing of selected anomalies is planned to
start during Q2 2023. An airborne gravity gradiometry
and magnetic survey covering the entire project was
completed and preliminary results expected by the
end of March 2023.

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

Electricity
Market in
Spain

FY2022 Average Prices

During 2022, electricity prices in
Spain reached unprecedented levels
as a result of the impact of the war
in Ukraine on the European and
global energy markets. Severe spikes
in natural gas prices in Europe
pushed electricity prices in Spain to
over €500/MWh in March 2022 and
similar levels in late August and early
September 2022.

Electricity prices moderated in
Q4 2022, due to the combination
of mild weather in Europe, good
supplies of LNG into Europe and
a strong contribution from wind
generation in Spain. As a result, real-
ised electricity prices were approx-
imately €170/MWh in Q4 2022,
bringing the annual average real-
ised price to approximately €240/
MWh in FY2022. This compares to
prices of approximately €65/MWh in
FY2021. As previously disclosed, an

increase in realised electricity prices
of €100/MWh results in an increase
to the Company’s annual operating
costs of around €37 million.

Prices in 2023

So far in 2023, the estimated realised
market electricity price in Spain
has averaged around €130/MWh,
with volatility driven by the relative
amount of electricity generated by
wind.

Since 1 January 2023, the Company
has benefited from its 10-year power
purchase agreement (“PPA”), which
will provide the Company with
approximately 31% of its current
electricity requirements at a fixed
rate. When including the contribu-
tion of the PPA, estimated realised
electricity prices for the Company
have averaged around €110/MWh so
far in 2023.

Atalaya Mining Plc.

Management Report

Operational Review

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

Renewable Energy Projects

The Company continues to advance construction of its 50 MW

solar plant at Riotinto, which is expected to provide approximately

22% of its current electricity needs when fully operational.

All major materials are on site
and civil works are underway.
Start-up of the 50 MW solar plant
is now expected to be in late 2023.
Combined, the 50 MW solar plant
and long-term PPA will provide
over 50% of the Company’s

current electricity requirements
at a rate below historical prices in
Spain.

As previously disclosed, the
Company continues to evaluate
additional renewable power

initiatives that could deliver
further low cost and carbon-free
electricity for its operations at
Riotinto, including wind turbines.
Following the installation of an
evaluation tower in September
2022, new wind measurements
are now being compared to
the extensive historical ground
level data in order to establish
confidence in the area’s wind
characteristics and determine
the viability of developing a small
wind farm at Riotinto dedicated to
self-consumption.

Corporate Updates 2022

As announced on 21 March 2022, the Company
received the formal Judgment from the High Court
of Justice in relation to the Claim by Astor for residual
interest arising out of the payment of €53 million
to Astor. On 8 April 2022, the Company transferred
€9.6 million to Astor from the trust account already
established by Atalaya on 15 July 2021. In addition, €1.1
million were paid on 16 May 2022 to Astor under the
Master Agreement.

Atalaya Mining Plc.

Operational Review

Management Report

Operational
Guidance

The forward-looking information contained in this section
is subject to the risk factors and assumptions contained in
the cautionary statement on forward-looking statements
included in the Basis of Reporting. The Company is aware
that the geopolitical developments in Ukraine and its impact
on energy prices and other supplies may still have further
effects or impact how the Company can manage it opera-
tions and is accordingly keeping its guidance under regular
review. Should the Company consider the current guidance
no longer achievable, then the Company will provide a
further update.

Proyecto Riotinto operational guidance for 2023 is as follows:

Ore mined

million tonnes

Wasted mined

million tonnes

Ore processed

million tonnes

Copper ore grade

17.1

24.1

15.3-15.8

0.40-0.42

84-86

53,000-55,000

2.80-3.00

3.00-3.20

Copper recovery rate

Contained copper

Cash cost

All-in sustaining cost

tonnes

$/lb payable

As announced in the Company’s Q4 2022 Operations
Update, production guidance for 2023 is 53,000 to
55,000 tonnes of copper, which represents an increase
over FY2022 production of 52,269 tonnes.

Inflationary pressures continue to impact the global
mining industry. The prices of many key inputs,
including diesel, tyres, explosives, grinding media
and lime, increased materially in 2022 as a result of
higher global energy prices and logistics constraints.
Although prices have stabilised for certain items,
overall input costs remain well above 2021 levels.

In addition, electricity continues to be a major
component of the Company’s cost structure due to
the elevated market prices in Spain. As a result, the

Company is again providing cash cost and AISC guid-
ance that reflects a range of outcomes of potential
market electricity prices for 2023.

The cash cost guidance range for 2023 is $2.80 to
$3.00/lb copper payable and the AISC guidance range
is $3.00 to $3.20/lb copper payable. These cost guid-
ance ranges are based on an assumed market elec-
tricity price range of €100 to 150/MWh and also include
the benefit of the Company’s PPA.

In addition, the Company expects to spend approx-
imately €13.0 million in 2023 as part of the project
to increase the capacity of the tailing dam. AISC are
presented net of the one-off project to increase the
capacity of the tailing dam.

Atalaya Mining Plc.

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

2.3

Management Report

Financial Review

Income Statement

The following table presents a summarised consolidated income statement for the twelve months period ended 31
December 2022, with comparatives and comparison with the twelve months ended 31 December 2021.

(Euro 000’s)

Revenues from operations

Cost of sales

Corporate expenses

Exploration expenses

Care and maintenance expenditure

Other income

EBITDA

Depreciation/amortisation

Net foreign exchange gain/(loss)

Net finance cost

Tax

Profit for the year

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

Three month
ended 31 Dec
2022

Three month
ended 31 Dec
2021

Twelve month
ended 31 Dec
2022

Twelve month
ended 31 Dec
2021

99,893

(71,797)

(4,598)

(3,801)

(1,494)

(4)

18,199

(8,775)

(4,181)

1,030

1,766

8,039

101,452

361,846

405,717

(43,835)

(4,403)

(978)

(1,333)

50,903

(8,642)

1,622

(12,814)

(3,042)

28,027

(289,554)

(192,972)

(9,954)

(4,257)

(3,053)

286

55,314

(34,119)

11,546

(421)

(1,394)

30,926

(9,715)

(1,800)

(2,116)

199,114

(32,276)

6,589

(13,600)

(27,601)

132,226

Three months
financial review

Copper contained in concentrates
sold was 14,027 tonnes in Q4 2022
(Q4 2021: 13,568 tonnes).

Revenues for Q4 2022 amounted
to €99.9 million (Q4 2021: €101.5
million). Higher concentrate sold
offset lower commodity prices.

The realised price (excluding QPs)
for Q4 2022 was $3.70/lb copper
compared to $4.40/lb copper in
the same period of 2021.

Copper concentrate production
during Q4 2022 was 68,908 tonnes
(Q4 2021: 64,695 tonnes) and
69,727 tonnes of copper concen-
trate were sold in the same period
(Q4 2021: 63,673 tonnes). Higher
production levels were mainly the
result of slightly higher tonnes
processed in the quarter.

Cost of sales for Q4 2022
amounted to €71.8 million,
compared to €43.8 million in Q4
2021. Unit operating costs in Q4
2022 were significantly higher
than in Q4 2021 due to the signif-
icantly higher cost of electricity
(€49.6 million higher), diesel and
other supplies as result of inflation

and the geopolitical situation in
the Ukraine.

Cash costs of $2.90/lb payable
copper for Q4 2022, were higher
than $2.24/lb payable copper in
the same period last year. Higher
cash costs were primarily due to
the significantly higher electricity
price as well as increased costs for
other supplies. The weaker Euro/
US Dollar rate in Q4 2022 offset a
portion of the higher operating
costs. AISC excluding investment
in the tailings dam in Q4 2022
were $3.12/lb payable copper
compared with $2.46/lb payable
copper in Q4 2021.

Atalaya Mining Plc.

Financial Review

Management Report

E-LIX Phase I plant totalled €3.9
million, of which €0.6 million was
booked as long-term loans to Lain
Technologies Ltd.

same period last year. Main costs
related to exploration works come
from Proyecto Masa Valverde and
Ossa Morena.

Sustaining capex for Q4 2022,
included in capital expenditure,
amounted to €1.6 million (Q4 2021:
€1.5 million). Sustaining capex
mainly accounted for enhance-
ments in processing systems of
the plant. In addition, the Company
invested €4.8 million (Q4 2021:
€4.6 million) in the project to
increase the tailings dam.

Corporate costs for Q4 2022 were
€4.3 million, compared to €4.4
million for Q4 2021. Corporate
costs mainly include the Compa-
ny’s overhead expenses.

Capex associated with the
construction of the 50 MW solar
plant amounted to €10.7 million in
Q4 2022, while investments in the

Exploration costs related to
the Proyecto Riotinto for Q4
2022 amounted to €3.8 million,
compared to €1.0 million in the

Care and maintenance costs for
Q4 2022 amounted to €1.5 million,
compared to €1.3 million for Q4
2021. The increase is mainly related
to Proyecto Touro and Masa
Valverde.

EBITDA for Q4 2022 amounted to
€18.2 million, compared to EBITDA
of €50.9 million for Q4 2021.

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

Twelve months
financial review

Revenues for FY2022 amounted
to €361.8 million (FY2021: €405.7
million).

Copper concentrate production
during FY2022 was 249,543 tonnes
(FY2021: 270,713 tonnes) and
251,268 tonnes of copper concen-
trate were sold in the same period
(FY2021: 277,792 tonnes). Lower
production levels were mainly
the result of lower ore grades and
lower throughput following the
transport sector strike in Q1 2022.
Inventories of concentrates as
at the reporting date were 3,529
tonnes (31 Dec 2021: 5,254 tonnes).

Copper contained in concentrates
sold was 55,323 tonnes in FY2022
(FY2021: 61,662 tonnes).

The realised price (excluding QPs)
for the twelve-months period
in 2022 was $3.96/lb copper
compared to $4.22/lb copper in the
same period of 2021. Concentrates
were sold under offtake agree-
ments in place. The Company did
not enter into any hedging agree-
ments in either 2022 or 2021.

Cost of sales for FY2022 amounted
to €289.6 million, compared to
€193.0 million in FY2021. Unit
operating costs in FY2022 were
significantly higher than in FY2021
due to the significantly higher
cost of electricity (circa. €63.8
million higher), diesel and other
supplies as result of inflation and
the geopolitical situation in the
Ukraine.

Cash costs of $3.16/lb payable
copper for FY2022, were higher
than $2.18/lb payable copper in
the same period last year. Higher
cash costs were primarily due to
the significantly higher electricity
price as well as increased costs
for other supplies. The stronger
US Dollar/Euro rate in FY2022
offset a portion of the higher
operating costs. AISC excluding
investment in the tailings dam
in FY2022 were $3.37/lb payable
copper compared with $2.48/
lb payable copper in FY2021. The
increase is mainly attributable
to the higher cash costs despite
lower capitalised stripping costs,
which amounted to €0.7 million
in FY2022 compared with €9.8
million invested in FY2021.

Sustaining capex for FY2022,
included in capital expenditure,
amounted to €6.2 million (FY2021:
€5.9 million). Sustaining capex
mainly accounted for enhance-
ments in processing systems
of the plant. In addition, the
Company invested €14.1 million
(FY2021: €14.1 million) in the project
to increase the tailings dam.

Capex associated with the
construction of the 50 MW solar
plant amounted to €22.7 million in
FY2022, while investments in the
E-LIX Phase I plant totalled €16.8
million, of which €10.9 million was
booked as long-term loans to Lain
Technologies Ltd.

Corporate costs for FY2022 were
€9.7 million, compared to €9.7
million for FY2021. Corporate costs
mainly include the Company’s
overhead expenses.

Exploration costs related to the
Proyecto Riotinto for FY2022
amounted to €4.3 million,
compared to €1.8 million in the
same period last year. Main costs
related to exploration works come
from Proyecto Masa Valverde and
Ossa Morena.

Management Report

Financial Review

Care and maintenance costs for
FY2022 amounted to €3.1 million,
compared to €2.1 million for
FY2021. The increase is mainly
related to Proyecto Touro and
Masa Valverde.

EBITDA for FY2022 amounted
to €55.3 million, compared to
EBITDA of €199.1 million for

FY2021. The decrease is mainly
attributed to lower concentrate
sold and commodity prices in
addition to higher cash costs.

Depreciation and amortisation
amounted to €34.1 million for
FY2022 (FY2021: €32.3 million),
as a result of the higher level of
assets subject to depreciation

following the completion of assets
previously under construction.

Net finance costs for FY2022
amounted to negative €0.4 million
(FY2021: negative €13.6 million). Net
finance costs decreased mainly
due to the accrual recognised
in 2021 for the interest related to
Astor case amounted to €11.8m.

Financial Position

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

(Euro 000’s)

ASSETS

Non-current assets

Other current assets

Tax refundable

Cash and cash equivalents

Total Assets

Shareholders’ Equity

LIABILITIES

Non-current liabilities

Current liabilities

Total Liabilities

Total Equity and Liabilities

31 Dec 2022

31 Dec 2021

433,494

103,029

100

126,448

663,071

466,297

51,244

145,530

196,774

663,071

402,459

74,948

483

107,517

585,407

435,898

68,991

80,518

149,509

585,407

Assets

Total assets were €663.1 million as at 31 December
2022, compared to €585.4 million as at 31 December
2021, an increase of €77.7 million. The Group’s signif-
icant assets are its mining rights and mining plant
at Proyecto Riotinto. Cash and cash equivalents
increased as result of the operating activities.

Non-current assets as at 31 December 2022 amounted
to €433.5 million (2021: €402.0 million). These
comprise €354.9 million of PP&E (2021: €333.1 million),
€53.8 million of intangible assets (2021: €57.4 million),
€16.4 million of non-current receivables (2021: €5.3
million), €1.1 million of non-current financial assets
(2021: €1.1 million) and €7.3 million of deferred tax
assets (2021: €5.5 million).

Other current assets as at 31 December 2022
amounted to €103.0 million (2021: €75.0 million), out
of which €64.2 million (2021: €50.1 million) related to
trade and other receivables and €38.8 million (2021:
€24.9 million) related to spare parts and ore in stock-
pile classified as inventories. Financial Position (cont.)

Trade and other receivables comprise €14.8 million
of sales of copper concentrate receivables from third
parties (2021: €8.9 million), €12.8 million (2021: €20.3
million) related to sales of copper concentrate receiv-
ables from related parties, €28.9 million (2021: €17.3
million) related to VAT due from authorities in Spain
and Cyprus; €5.8 million (2021: €3.3 million) related to
prepayments and other current assets amounted to
€1.8 million (2021: €0.4 million).

Atalaya Mining Plc.

Financial Review

Management Report

Liabilities

Non-current liabilities stood at €51.2 million as at 31
December 2022 compared to €69.0 million as at 31
December 2021. Non-current liabilities mainly represent
the rehabilitation provision amounting to €24.1 million
as at 31 December 2022 (2021: €26.3 million). In addition
to the rehabilitation provision, non-current liabilities
included the long term portion of borrowings of €20.8
million (2021: €34.1 million), the long-term portion of
leases €4.4 million (2021: €4.9 million), legal provisions
€0.2 million (2021: €0.3 million), and trade payables of
€2.0 million (2021: €3.5 million).

Current liabilities amounted to €145.5 million at 31
December 2022 (2021: €80.5 million). Current liabilities
balance is comprised of the borrowings related to the
payment of the Deferred Consideration to Astor, Solar
Plant and other operating facilities €52.6 million (2021:
€13.4 million) and trade and other payables amounting
to €90.0 million (2021: €66.2 million) of which €85.0
million related to suppliers (2021: €49.7 million); €3.3
million related to accruals (2021: €16.3 million) and
€1.7 million (2021: €0.2 million) related to other current
payables. Other current liabilities include current tax
liabilities.

Results

The Group’s and Company´s consolidated results are
set out on page 102.

Distribution of Profits
and Dividend

On 10 August 2022, the Company’s Board of Directors
elected to declare an interim dividend for H1 2022 of
US$0.036 per ordinary share, which was equivalent to
3.13 pence per share and amounted to €5.1 million. The
interim dividend was paid on 20 September 2022.

The Board of Directors has proposed a final dividend
for 2022 of US$0.0385 per ordinary share, which is
equivalent to approximately 3.15 pence per share.
Payment of the Final Dividend is subject to share-
holder approval at the Company’s 2023 Annual General
Meeting (“AGM”). Should it be approved, the Final
Dividend, together with the Interim Dividend paid in
September 2022, would result in a Full Year Dividend
of US$0.0745 per ordinary share, which is equivalent
to approximately 6.28 pence per share. Further details
on the timing of the potential payment of the Final
Dividend will be provided ahead of the AGM.

Liquidity and Capital
Resources

Atalaya monitors factors that could impact its liquidity
as part of the Company’s overall capital management
strategy. Factors that are monitored include, but are not
limited to, the market price of copper, foreign currency
rates, production levels, operating costs, capital and
administrative costs.

The following is a summary of Atalaya’s cash position
as at 31 December 2022 and 2021, and cash flows for
the twelve months ended 31 December 2022 and 2021.

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

Liquidity Information

(Euro 000’s)

31 Dec 2022

31 Dec 2021

Unrestricted cash and cash equivalents at Group level

Unrestricted cash and cash equivalents at Operation level

Restricted cash and cash equivalents at Operation level

Consolidated cash and cash equivalents

Net cash position

Working capital surplus

108,550

17,567

331

126,448

53,085

48,375

43,722

15,420

107,517

60,073

84,047

102,430

Management Report

Financial Review

Overview of the Group’s Cash Flows

(Euro 000’s)

Twelve month
ended 31 Dec 2022

Twelve month
ended 31 Dec 2021

Cash flows from operating activities

Cash flows used in investing activities

Cash flows from financing activities

Net increase in cash and cash equivalents

Net foreign exchange differences

Total net cash flow for the period

38,503

(53,529)

22,411

7,385

11,546

18,931

148,841

(87,531)

1,851

63,161

6,589

69,750

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

Unrestricted cash and cash equivalents as at 31
December 2022 increased to €126.4 million from €92.1
million at 31 December 2021. The increase in cash
balances is due to the cash flows generated during
2022. Cash balances are unrestricted and include
balances at operational and corporate level. Restricted
cash of €0.3 million represented the amount in escrow
out of which the Company has paid interest of €9.6
million on 7 and 8 April 2022 (following the trial in
February and March 2022) and €1.1 million on 16 May
2022 to Astor under the Master Agreement. Following
the payment made in May 2022, the balance (less an
amount representing £280,000, or~€350k being the
remaining potential liability to Astor on costs) reverted
to the Company and it has been classified as unre-
stricted cash.

As of 31 December 2022, Atalaya reported a working
capital surplus of €84.0 million, compared with
a working capital surplus of €102.4 million at 31
December 2021. The situation in 2022 is that the
decrease in working capital surplus relates to the
increase in current liabilities. Cash increased compared
to previous year. At 31 December 2022, trade payables
have increased by 36.0% compared with the same
period last year, mainly attributed to inflation and also
timing differences.

The Directors consider current net cash position as
well as the existing levels of the commodity prices and
the current liquidity position to mitigate any potential
financial risks linked to the liquidity position of the
Company.

Cash and cash equivalents increased by €18.9 million
in the twelve months period ended 31 December
2022. This increase was due to cash from operating
activities amounting to €38.5 million, cash used in
investing activities amounting to €53.5 million and
cash generated by financing activities totalling €22.4
million, and net foreign exchange of €11.5 million.

Cash generated from operating activities before
working capital changes was €56.9 million in line with
EBITDA of €55.3 million. Atalaya increased its trade
receivables by €24.5 million and its inventory levels
by €14.1 million and trade payables increased in the
period by €24.7 million. Corporate tax paid during the
period was €3.3 million.

Investing activities in 2022 amounted to €53.5 million,
and the capitalised expenditure relating to the tailings
dam project and continuous enhancements to the
processing systems of the plant.

Financing activities in 2022 amounted to €22.4
million. The Company increased its financing by €22.4
million mainly due to the use of existing unsecured
credit facilities to pay the Solar Plant. The payment
was financed by unsecured credit lines by four major
Spanish banks having a three-year tenure and an
average annual interest rate of approximately two per
cent. This was offset by the payment of dividends of
€5.1 million.

Atalaya Mining Plc.

Financial Review

Management Report

Dividends

The following table summarises the movement in key currencies versus
the EUR:

The Company’s Board of Direc-
tors elected to declare an interim
dividend for H1 2022 of US$0.036
per ordinary share, which was
equivalent to 3.13 pence per share
and amounted to €5.1 million. The
interim dividend was paid on 20
September 2022.

The Board of Directors has
proposed a final dividend for 2022
of US$0.0385 per ordinary share,
which is equivalent to approx-
imately 3.15 pence per share.
Dividend is subject to shareholder
approval at the Company’s 2023
Annual General Meeting

(Euro 000’s)

Twelve months
ended 31 Dec 2022

Twelve months
ended 31 Dec 2021

Average rates for the periods

GBP – EUR

USD – EUR

Spot rates as at

GBP – EUR

USD – EUR

0.8528

1.0530

0.8869

1.0666

0.8596

1.1827

0.8403

1.1326

During 2022 and 2021, Atalaya did not have any currency hedging
agreements.

Creditors’
Payment Terms

The Group does not have a specific
policy towards its suppliers
and does not follow any code
or standard practice. However,
terms of payment with suppliers
are settled when agreeing overall
terms of business, and the Group
seeks to abide by the terms of the
contracts to which it is bound.

Critical
accounting
policies,
estimates,
judgements,
assumptions
and accounting
changes

Treasury shares

As at 31 December 2022 and at the
date of this report, the Company
held nil (2021: nil) ordinary shares
as treasury shares.

Foreign
Exchange

In FY2022, Atalaya recognised a
foreign exchange gain of €11.5
million (FY2021 gain: €6.6 million).
The foreign exchange gain mainly
related to variances in EUR and
USD conversion rates during the
period as all sales are settled and
occasionally held in USD.

The preparation of Atalaya’s Finan-
cial Statements in accordance with
IFRS required management to
made estimates and assumptions
that affected amounts reported
in the Financial Statements and
accompanying notes. There is a
full discussion and description
of Atalaya’s critical accounting
estimates and judgements in the
audited financial statements for
the year ended 31 December 2022
(Note 3.3).

Going Concern

These audited consolidated
financial statements have been
prepared based on accounting
principles applicable to a going
concern which assumes that
the Group will realise its assets

Atalaya Mining Plc.

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

and discharge its liabilities in
the normal course of business.
Management has carried out an
assessment of the going concern
assumption and has concluded
that the Group will generate suffi-
cient cash and cash equivalents
to continue operating for the next
twelve months.

The Directors, after reviewing
different scenarios with current
commodities prices, the current
cash resources, forecasts and
budgets, timing of cash flows,
borrowing facilities, sensitivity
analyses and considering the
associated uncertainties to the
Group’s operations for a period
of at least 12 months since the
approval of these audited consol-
idated financial statements have
a reasonable expectation that the
Company has adequate resources
to continue operating for the
foreseeable future. Accordingly,
the consolidated financial state-
ments continue to be prepared on
a going concern basis (see Note
2.1(b)).

Management continues to mon-
itor the impact of geopolitical
developments. Currently no sig-
nificant impact is expected in the
operations of the Group.

Management Report

Other Matters

2.4

Other Matters

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

Significant shareholders

The shareholders holding more than 5% (directly
or indirectly) of the issued share capital as of 31
December 2022 are:

Urion Holdings (Malta)
Ltd (subsidiary of
Trafigura)

Ordinary
Shares 000’s

30,821

22.03

Cobas Asset
Management, SGIIC, S.A.

18,227

13.03

Share Capital Structure

Hamblin Watsa
Investment Counsel

8,252

5.90

During 2022, the Company had the following
weighted average number of shares outstanding and
commitments to issue shares:

Ordinary shares

Options

Diluted

Weighted No. of
Ordinary Shares

139,879,209

3,543,500

143,422,709

In January and June 2022, the Company granted
1,345,000 share options (2021: 1,150,000 share options)
to the key management and employees.

In 2022, Atalaya increased its share capital by
1,643,250 shares (2021: 95,250) as result of share option
executions.

Details on authorised and issued share capital are
disclosed in Note 22 of the financial statements.

Between 31 December 2022 and the date of approval
of the consolidated and Company financial state-
ments there have been changes on the share capital
holding.

Urion Holdings (Malta)
Ltd (subsidiary of
Trafigura)

Ordinary
Shares 000’s

30,821

22.03

Cobas Asset
Management, SGIIC, S.A.

18,687

13.36

Hamblin Watsa
Investment Counsel

8,252

5.90

Atalaya Mining Plc.

Other Matters

Management Report

Related parties

Internal Controls

The Group has transactions with related parties in
sales and other nature associated with its business, as
disclosed in Note 30.

Environmental

The Group is committed to conducting its business in
accordance with the spirit and letter of all applicable
environmental laws and regulations. The Group has
the obligation to restore the operating locations. The
nature of these restoration activities includes disman-
tling and removing structures, rehabilitating mines,
and tailings dams, dismantling operating facilities,
closure of plant and waste sites and restoration, recla-
mation and re-vegetation of affected areas (Note 26).

Articles of association

The Company’s Articles of Association may only be
amended by Special Resolution at the Annual General
Meeting or at an Extraordinary General Meeting.

Political and Charitable
Donations

The Group made no political donations neither char-
itable donations during the year ended 31 December
2022 (2021: €nil). In addition, Atalaya contributes
through its Foundation to financing projects that
benefit local communities in cooperation with
local municipalities based on our Corporate Social
Responsibility.

Research and Development
Activities

Atalaya carries out research and development activ-
ities that are necessary to support and expand the
operations.

Existence of Branches

The Group does not operate any branches.

The Audit and Financial Risk Committee, established
by the Board of Directors, is responsible for reviewing
and assessing the adequacy of the overall internal
control systems and accounting procedures of the
Company including reviewing the Company’s proce-
dures for internal control.

Statement of Corporate
Governance

The Group and the Company give special attention
to the application of sound corporate governance
policies, practices and procedures. Corporate Govern-
ance is the set of procedures followed for the proper
management and administration of the Group. Corpo-
rate Governance rules the relationship between the
shareholders, the Board of Directors and the manage-
ment team of a company.

The QCA code has been adopted by the Group and
the Company since its inception for Directors’ dealings
which is appropriate for an AIM listed company. The
Directors comply with Rules 21 and 31 of the AIM Rules
relating to Directors’ dealings and will continue to
take all reasonable steps to ensure compliance by the
Group’s applicable employees as well.

Corporate Governance Code

The QCA code is inherent to the Company´s founda-
tion and Atalaya´s medium and long-term success
depends on its compliance with the QCA code and
with its forward looking and long-term objectives.

The Company has adopted a code of standards since
its inception for Directors’ dealings which is appro-
priate for an AIM listed company. The Directors do
comply with Rules 21 and 31 of the AIM Rules relating
to Directors’ dealings and will take all reasonable
steps to ensure compliance by the Group’s applicable
employees as well.

The Board reviews and is in frequent contact with the
CEO and with other representatives of the Company to
see if the Company and its employees are in a healthy
working environment and to check if the state of the
culture represents its values.

The Company is incorporated in Cyprus, so it is subject
to Cypriot laws and regulations, and is subject to the
regulations of AIM, its trading platforms. There is no
conflict there and in fact makes it easier to be more
transparent and straightforward with its shareholders.

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

Atalaya Mining Plc.

Management Report

Other Matters

Quoted Company Alliance
(QCA)

The QCA is an independent membership that “cham-
pions the interests of small to mid-size listed compa-
nies”. The QCA represents companies employing
around 1.4 million workers and they set out the
guidelines of independence and transparency for said
businesses.

In 2018, the QCA issued an updated version of its
Corporate Governance Code. This version of the Code
includes 10 corporate governance principles that
companies should follow, and step-by-step guidance
on how to effectively apply these principles.

Please refer to the Corporate Governance Report for
further details.

Directors’ Responsibilities
for the Financial
Statements

Cyprus company law states that the Directors are
responsible for the preparation of financial statements
for each financial year which give a true and fair view
of the state of affairs of the Company and of the Group
and of the profit or loss of the Group for that period.

In the preparation of these financial statements, the
Directors are required to:

select suitable accounting policies and then apply
them consistently;

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

Composition,
Responsibilities and
Remuneration of the
Board of Directors

The members of the Board of Directors as at 31
December 2022 and on the date of this report
are presented in the Corporate Governance
report. There were no significant changes in the
assignment of responsibilities of the members
of the Board of Directors.

For further details on the composition, responsi-
bilities and remuneration of the Board of Direc-
tors, please refer to the Corporate Governance
Report.

Members of the Board
of Directors

The Board of Directors, during the year 2022
comprised:

Roger Davey

Hussein Barma

Stephen Scott

Independent
Non-executive Chair

Independent
Non-executive Director

» make judgements and estimates that are reason-

Neil Gregson

able and prudent; and

state whether applicable accounting stand-
ards have been followed, subject to any material
departures disclosed and explained in the financial
statements.

The Directors are responsible for maintaining proper
accounting records, for safeguarding the assets of the
Group and for taking reasonable steps for the preven-
tion and detection of fraud and other irregularities.
Legislation in Cyprus governing the preparation and
dissemination of the financial statements may differ

Jesus Fernandez

» Non-Independent

non-executive Director

Harry Liu(*)

» Non-Independent

Kate Harcourt(**)

non-executive Director

Independent
Non-executive Director

Alberto Lavandeira

» Non-Independent Chief

Executive Officer

(*) On 24 March 2022, Atalaya announced that Mr. Harry
Liu has stepped down as a Non-Executive Director of the
Company with immediate effect.

(**) On 19 May 2022, the Board of Directors appointed Kate
Harcourt as an independent Non-executive Director of the
Company.

Atalaya Mining Plc.

Other Matters

Management Report

from legislation in other jurisdictions.

Auditors

The auditors, Ernst & Young Cyprus Ltd., have
expressed their willingness to continue in office and a
resolution approving their reappointment and giving
authority to the Board of Directors to set their remu-
neration will be proposed at the next Annual General
Meeting.

Company secretary

Inter Jura CY (Services) Limited serve as the Company
Secretary. The Company Secretary is appointed and
dismissed by the Board of Directors and all directors
have a right of access to the Company Secretary.
The Company Secretary is accountable to the Board,
through the Chair, on all governance matters and
reports directly to the Chair as the representative of
the Board.

Events after the Reporting
Period

Any significant events that occurred after the end of
the reporting period are described in Note 34 to the
financial statements.

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

By Order of the Board of Directors,

Roger Davey

Chair

Nicosia, 21 March 2023

Atalaya Mining Plc.

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

Management Report

Principal Risks and Uncertainties

2.5

Principal Risks and
Uncertainties

Due to the nature of Atalaya’s business
in the mining industry, the Group is
subject to various risks that could
materially impact its future operating
results and could cause actual events to
differ materially from those described in
forward-looking statements relating to
Atalaya.

Atalaya´s principal risks have continued to fall within
four categories:

» Strategic risks;
» Commercial and financial risks;
» External risks; and
» Operational risks

In addition to the above commercial and finance risks,
please refer to Note 3 of the financial statements for
further details on the financial risk management policy
adopted by the Group and the Company.

High

Medium

Low

Risk

Nature of the Risk

Mitigation of Risk

Importance

0 1

Strategic Risks

Single
asset, single
commodity
and single
country risk

The Company´s current production relates to
Proyecto Riotinto, which is its single producing
asset. Atalaya produces and sells copper concen-
trate with silver by-product. Any interruption in the
producing asset may impact the Group’s results.

The operation has been producing since restart in 2016, with
cash costs below the market price for copper even taking into
account recent cyclical lows. Atalaya is constantly evaluating
acquisitions in the mining sector, to increase the number of
operations under management. The Group’s Business Devel-
opment Department reviews potential growth opportunities,
transactions and approves or recommends them within
authority levels set by the Board.

Lack of
replacement of
reserves

Atalaya must continually replace and expand its
mineral resources. The depletion of its mineral
reserves may not be offset by future discoveries or
acquisitions.

On-going exploration campaigns currently in areas close to
Proyecto Riotinto.

During 2022, Atalaya incurred in a total of €4.3 million in
exploration activities.

Underestima-
tion of capex,
finance and
licence to
operate

Atalaya’s capital expenditure at future projects
may require more capital than anticipated and/or
Atalaya may have difficulties in obtaining required
permitting and financing, which could delay
project developments.

Atalaya has set its exploration budget for 2023 to €10.1 million
which includes exploration for Proyecto Riotinto, Proyecto
Riotinto Este, Ossa Morena Proyecto Touro and Masa Valverde.

Atalaya monitors project controls to ensure that we deliver
approved projects on time, on budget and in line with the
defined specifications.

0 2

Commercial and Financial Risks

Significant
changes to
commodity
prices

A decline in the price of copper and other metals
in world markets, which can fluctuate widely,
could adversely affect Atalaya´s business, oper-
ating results and prospects.

The mine’s cash costs are below the market price for copper,
even at recent cyclical lows. Atalaya is constantly monitoring
commodity prices and revisiting hedging strategies and
policies.

Inflation and
cost pressure
to supply chain

Geopolitical conflicts have resulted in significant
increases on prices for certain products with a
particular impact on electricity prices.

Monitoring trend on supplies prices’ and where available long
term agreement to reduce the exposure to volatility prices.

Limited
number of
customers

A significant portion of Atalaya´s concentrate
production is sold to three offtakers. Offtakers’
business can significantly impact the Company’s
operations.

Close contact with offtakers to ensure we understand how
they run their business.

Lack of control
over certain
key inputs

Atalaya may be unable to control the availability of
key inputs such as fuel, explosives, reagents and
steel which are beyond management’s influence.

The procurement department of Atalaya Riotinto Minera,
S.L.U. is continually expanding their network influence to
ensure our supply chain is secure.

Atalaya Mining Plc.

Principal Risks and Uncertainties

Management Report

Risk

Nature of the Risk

Mitigation of Risk

Importance

Foreign
exchange risk

Volatility in the EUR:USD exchange rate affects the
Group’s profitability.

Atalaya is continually monitoring exchange rate and
revisiting hedging strategies policies.

Liquidity risk

Atalaya’s operations and business model are subject to a
variety of financial risks of third parties.

Manage the liquidity and financing structure in
accordance with the business model.

Maintain a diverse portfolio of banks and funds.

0 3

External Risks

Political, legal
and regulatory
developments

Atalaya is subject to extensive regulation, concessions,
authorisations, licences, and permits which are subject
to expiration, to limitation on renewal and to various
other risks and uncertainties.

Monitoring all legal and political decisions that might
impact the mining sector, by participating among
peer miners in the area in professional agencies and
meetings.

Atalaya is also subject to laws and regulations relating
to taxation, customs and royalties that could have an
adverse effect on its business, financial conditions and
results of operations.

Geopolitical
conflicts

Recent conflicts between countries have impacted
general economic conditions worldwide, including
migration flows, volatility in regulated markets and
inflation pressure

Partner with government and local municipalities.

AAU (Environmental Declaration) and mining permit
have been monitored by the Company to achieve a
successful result.

Atalaya is monitoring the current situation of the
environmental permit at Proyecto Touro.

The Group has no operations or material exposure in
the UK. Brexit did not have any appreciable impact
on the Group. This position is maintained following
completion of the transaction period.

Recurrent meetings and analysis performed by local
advisors to ensure that Atalaya monitored and antici-
pated taxation for significant business decisions.

Monitoring commodities prices, supplies prices and
international economic variations.

Economic
conditions

General economic conditions or changes in consump-
tion patterns may adversely affect Atalaya´s growth and
profitability. In particular, the Chinese market, which has
significant impact on the world’s copper demand.

Monitoring commodities prices, supplies prices and
international economic variations.

Public health
threats

Public health threats such as coronavirus (COVID-19)
or other epidemics or pandemics could affect the
operations of the Group, the operations of the Group’s
customers and suppliers.

The Group is continuously monitoring public health
threats and takes necessary steps to protect the
health and safety of its staff and minimise any disrup-
tion to its operations.

Operational risks
and hazards

Operational risks and hazards may adversely impact
Atalaya’s business, financial condition and result of
operations, particularly: floods, natural disasters, indus-
trial accidents, labour disputes, structural collapses,
transportation delays and earthquakes.

Atalaya constantly invests in health and safety and
regularly analyses ways in which to make its mine
safer.

Labour
disruptions

Atalaya may be adversely affected by labour disruptions.

Atalaya has periodic meetings with its trade unions
to discuss and agree on any changes to labour condi-
tions and concerns. Ongoing training programmes.

Dependence
on key
infrastructure

Atalaya is dependent on transportation facilities, infra-
structure and certain suppliers, a lack of which could
impact its production and development projects.

Atalaya´s contractors are very reliable. Atalaya main-
tains contingency plans to ensure operations would
not be affected.

0 4

Tailing dam
permitting

Operational Risks

Mining operations depend on the permit that need to
be renovated during the Life of Mine of the operation.
Recent failures in mining projects worldwide and
increase in regulation and standards may impact the
business

Atalaya maintains communications with communities
and stakeholders, including the Public Administration,
and proactively invest to improve safety of the opera-
tion beyond legal standards.

Water, electricity
and other key
supply shortages

Atalaya’s mining operations depend on the availability of
water, electricity and other key inputs.

Atalaya monitors water consumption and water levels
frequently as well as electricity prices. As the Company
expands, Atalaya will need more water and electricity.

Complexity of
environmental
laws

Atalaya’s operations are subject to complex and evolving
environmental laws and regulations and changes may
increase its running costs.

Atalaya has a dedicated team that reviews any new
laws and changes regularly. Atalaya has not been
made aware of any imminent changes.

Cyber security

A cyber-attack could affect our systems, data bases and
regular activities.

Atalaya’s IT department is regularly reviewing the
internal process to identify any potential attack and to
minimise any potential impact.

Atalaya Mining Plc.

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

2022 Annual Report

0 3

Directors’
and Officers’
Statement

Directors’ and Officers’ Statement

Statement by the
members of the
Board of Directors
and the Company
officers responsible
for the drafting of
the consolidated
and Company
financial statements
in accordance with
the provisions of the
Cyprus Law 190(I)/2007
on transparency
requirements.

We, the Members of the Board of Directors and the
Company officers responsible for the drafting of the consoli-
dated and Company financial statements of Atalaya Mining
plc for the year ended 31 December 2022, confirm that, to
the best of our knowledge:

1. The consolidated financial statements and the Company

financial statements on pages 78 to 83:

a. have been prepared in accordance with International
Financial Reporting Standards (“IFRS”) as adopted
by the European Union and the requirements of the
Cyprus Companies Law, Cap.113. For the year ending
31 December 2022, the standards applicable for IFRS’s
as adopted by the EU are aligned with the IFRS’s as
issued by the IASB, and,

b. give a true and fair view of the assets, liabilities, finan-

cial position and profit or loss of Atalaya Mining Plc and
the undertakings included in the consolidated and
Company financial statement taken as a whole; and

2. The Management Report includes a fair review of the

development and performance of the business and the
position of Atalaya Mining Plc and the undertakings
included in the consolidated and Company financial
statements as a whole, together with a description of the
principal risks and uncertainties that they face, and

3. The adoption of a going concern basis for the preparation
of the consolidated and Company financial statements
continues to be appropriately based on the foregoing
and having reviewed the forecast financial position of the
Group and Company.

The Officers and the Directors of the Company as at the
dated of this statement are as set out below:

Alberto Lavandeira

Cesar Sanchez

Chief Executive Officer

Chief Financial Officer

By Order of the Board of Directors,

Roger Davey

Chair

Nicosia, 21 March 2023

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

2022 Annual Report

0 4

Strategic
Report

Atalaya Mining Plc

CONTENT 04:

4 . 1

Market Overview

4 . 2

Strategic Framework

4.1

Strategic Report

Market Overview

Copper is one of the most widely used industrial metals in the world.
Its conductivity, malleability, and durability make it an essential
material for a range of applications, from electrical wiring and
construction to transportation and electronics. As a result, the global
copper market is a critical component of the global economy, with
significant implications for businesses, consumers, and governments
around the world.

In recent years, the global copper market has experienced a range of trends, challenges, and opportunities
that are shaping its future. Here are some of the key developments that are driving the market today:

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

Supply and Demand
Dynamics

Sustainability and
Environmental Concerns

The global copper market is
characterized by a complex supply
chain that spans mining, smelting,
refining, and fabrication. While
copper is abundant in the earth’s
crust, it is not evenly distributed,
and extraction and processing
require significant investment
and expertise. In recent years, the
market has been characterized by
a tight supply-demand balance,
with prices fluctuating based on
changes in global production and
consumption patterns.

Emerging Markets

The growing middle class in
emerging markets such as China,
India, and Brazil is driving demand
for copper, as these economies
continue to urbanize and industri-
alize. As a result, these markets are
playing an increasingly impor-
tant role in shaping the global
copper market. For example,
China accounts for nearly half of
the world’s copper consumption,
making it a key driver of global
demand.

The copper industry is facing
growing pressure to reduce its
environmental impact and adopt
more sustainable practices. From
reducing greenhouse gas emis-
sions to minimizing water use
and waste, copper producers are
investing in new technologies and
processes to reduce their envi-
ronmental footprint. At the same
time, there is increasing demand
for copper in renewable energy
systems such as solar panels and
wind turbines, which are seen as
critical components of the transi-
tion to a low-carbon economy.

Trade and Geopolitics

The global copper market is also
influenced by geopolitical factors
such as trade tensions, political
instability, and regulatory changes.
For example, trade disputes
between the United States and
China created uncertainty in the
market, while changes in mining
policies in countries such as Chile
and Peru can impact global supply.
Similarly, the transition to renew-
able energy systems is creating

Atalaya Mining Plc.

new geopolitical dynamics, as
countries seek to secure access to
critical minerals such as copper.

Despite these challenges, the
global copper market presents
significant opportunities for busi-
nesses and investors. For example,
the growing demand for copper
in emerging markets is driving
new investment in mining and
processing operations, while the
shift to renewable energy systems
is creating new markets for copper
and other critical minerals. In
addition, the adoption of more
sustainable practices is creating
new business models and technol-
ogies that can drive innovation and
competitiveness in the market.

In conclusion, the global copper
market is a complex and dynamic
industry that is shaped by a range
of trends, challenges, and oppor-
tunities. As demand for copper
continues to grow, businesses and
investors will need to navigate
these factors to stay competitive
and capture the benefits of this
critical market. By embracing
sustainability, innovation, and new
business models, the copper indus-
try can play a key role in shaping
the global economy of the future.

Market Overview

Strategic Report

Market Price

Realised Copper Prices

In January 2022, the copper price trend moved side-
ways as inflation rose and the possibility of interest
rate hikes increased. February saw no change in the
copper price trend, but in March, prices rose before
dropping due to macroeconomic factors in Chile and
the Fed’s announcement of an interest rate hike. April
saw a rise in copper prices, but the Fed remained firm
in its stance on interest rates. In May, China’s zero-
COVID stance caused a drop in copper prices, which
slipped further in June before hitting its lowest point
in July. August saw a notable increase in copper prices,
but September confirmed that the index was in a
sideways range. In Q4, the copper price trend turned
downward before rallying sharply in November and
remaining bullish in December.

The market copper price has a significant impact on
Atalaya’s ability to generate positive operating cash flows.

The average prices of copper for 2022 and 2021 were:

Realised copper price
(excluding QPs)

Market copper price per lb
(period average)

Unit

2022

2021

$/lb

3.96

4.22

$/lb

4.00

4.23

Realised copper prices for the reporting period noted
above have been calculated using payable copper
and excluding both provisional invoices and final
settlements of quotation periods (“QPs”) together. The
realised price during the year, including the QP, was
approximately $4.06/lb.

Spot vs Realised Copper price

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

5.0

4.5

4.0

b
l
/
$

3.5

3.0

2.5

2.0

1
2
-
n
a
J

1
2
-
b
e
F

1
2
-
r
a
M

1
2
-
r
p
A

1
2
-
y
a
M

1
2
-
n
u
J

1
2
-
l
u
J

1
2
-
g
u
A

1
2
-
p
e
S

1
2
-
t
c
O

1
2
-
v
o
N

1
2
-
c
e
D

2
2
-
n
a
J

2
2
-
b
e
F

2
2
-
r
a
M

2
2
-
r
p
A

2
2
-
y
a
M

2
2
-
n
u
J

2
2
-
l
u
J

2
2
-
g
u
A

2
2
-
p
e
S

2
2
-
t
c
O

2
2
-
v
o
N

2
2
-
c
e
D

Spot

Realised price (excl. QP)

Atalaya’s Response

The Group had no hedges on commodities prices
during 2022. At the date of this report, the Group is
fully exposed to copper prices with no commodities
hedging agreements in place.

Atalaya Mining Plc.

Strategic Report

Market Overview

Foreign Exchange

Atalaya’s Response

Foreign exchange rate movements can have a signif-
icant effect on Atalaya’s operations, financial position
and results. Atalaya’s sales are denominated in U.S.
dollars (“USD”), while Atalaya’s operating expenses,
income taxes and other expenses are denominated in
Euros (“EUR”), and to a much lesser extent in British
Pounds (“GBP”).

Accordingly, fluctuations in the exchange rates can
impact the results of operations and carrying value of
assets and liabilities on the balance sheet.

In 2022, the Group was positively impacted by favourable
rate against USD, the currency in which all sales of the
Group are denominated.

Management is continuously monitoring currency rates
and evaluating possible currency hedging to minimise
risk.

FX rates EUR: USD

1,30

1,20

1,10

1,00

0,90

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

1
2
-
n
a
J

1
2
-
b
e
F

1
2
-
r
a
M

1
2
-
r
p
A

1
2
-
y
a
M

1
2
-
n
u
J

1
2
-
l
u
J

1
2
-
g
u
A

1
2
-
p
e
S

1
2
-
t
c
O

1
2
-
v
o
N

1
2
-
c
e
D

2
2
-
n
a
J

2
2
-
b
e
F

2
2
-
r
a
M

2
2
-
r
p
A

2
2
-
y
a
M

2
2
-
n
u
J

2
2
-
l
u
J

2
2
-
g
u
A

2
2
-
p
e
S

2
2
-
t
c
O

2
2
-
v
o
N

2
2
-
c
e
D

Atalaya Mining Plc.

Strategic Framework

Strategic Report

4.2

Strategic Framework

The business model of Atalaya is founded upon creating value for
its stakeholders through operational and developmental excellence.
Experience and an unceasing search for improvement are the pillars of
its success.

Our values

Strategic pillars

Importance
of people

✓ Importance of Safety, Health, Environment &

our people

Security

✓ Strong workforce with longstanding

employees

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

Operational
excellence

✓ Importance of cost management

✓ Establishing high performance

✓ Operating to a world-class standard

✓ Maximising production capacity

our business

Creating
value

✓ Increasing asset value under management

our future

✓ Focusing on generating free cash flows

✓ Focusing on creating value for shareholders

✓ Allocating capital efficiently

✓ Creating opportunities for growth

Social
projects and
environmental

✓ Working closely with communities

✓ Contributing to community development

support local
communities
and protect the
environment

Atalaya Mining Plc.

04030201

Strategic Report

Market Overview

✓ Environmental matters are

discussed across the Group from
the operating workforce to the
Board of Directors.

✓ Continuous communication
with regulatory bodies and
shareholders to ensure a safe
world-class operation.

✓ Experienced mining team to

ensure proper safety, health and
security policies.

✓ Focused on creating a high-

performance culture where its
people are its core asset.

✓ Atalaya has a flat management
structure with accessible people.

✓ Atalaya’s personnel are primarily

based at sites.

✓ Focused on improving its
relationships with local
government and communities.

✓ Limited presence in the media,
with efforts focused on direct
contact with people.

✓ World-class processing plant in

Europe to maximise value of the
Group, thereby increasing free
cash flows from operations.

✓ Ensure the ongoing stable growth

of the Company

✓ Protecting and enhancing the

value for all stakeholders.

e
p
o
e
p
r
u
O

s
s
e
n
i
s
u
b
r
u
O

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

Key Driver

Achievements

Principal Risks

Cut expenditures
to reduce
environmental
impact

Average 500
employees

99.5% based at
mine sites

Socially responsible
through Fundación
Atalaya Riotinto

2022 Achievements

✓ Operational

Risks

✓ External
Risks

✓ Better monitoring
process of safety
records.

✓ Prompt responses

to COVID-19.

2023 Priorities

✓ Further improve
health and safety
statistics.

✓ Continue support to
local and regional
governments.

✓ Reduce LTI

compared with
2022.

✓ Financial
Risks

✓ Operational

Risks

15.4 Mt of ore
processed

52k tonnes of Cu
produced

€55.3m EBITDA

€38.5m cash flows
from operations

€126.4m cash
balance as at 31
December 2022

2022 Achievements

✓ Consolidation our
internal growth
with production
levels of 15 Mtpa.

✓ Contained All-in
sustaining cost.

✓ Increase to 99.9% of
Rio Narcea Nickel
S.L. share capital

✓ Operational

continuity despite
COVID-19.

2023 Priorities

✓ Further growth

via project
development or
acquisitions.

✓ Continue with

strong operational
performance.

Atalaya Mining Plc.

Strategic Framework

Strategic Report

Key Driver

Achievements

Principal Risks

Increase in reserves
and resources
by exploration or
acquisition of other
deposits

e
r
u
t
u
f

r
u
O

✓ Evaluation of existing

capacity of each project and
investment in exploration to
replace reserves deployed.

✓ With a view to becoming
a multi-asset producer
focussed in copper.

✓ Focus on the development

of low-cost assets in
mining-favourable
jurisdictions.

✓ Searching and evaluating
projects around the world.

✓ Strategic
Risks

✓ External
Risks

2022 Achievements

✓ Investment of €6.2

million (2021: €5.9 million)
in sustaining Capex in
Proyecto Riotinto.

✓ Investment of €14.1

million in tailing dams
improvements.

2023 Priorities

✓ Continuing exploration
works to expand the
reserves and resources of
Proyecto Riotinto.

✓ Exploration in Proyecto
Masa Valverde and Ossa
Morena.

✓ Monitoring new

opportunities related with
metals.

✓ Working to understand

and resolve environmental
permitting decision on
Proyecto Touro.

✓ Completion of E-LIX Plant.

✓ Completion of Solar Plant

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

s
e
i
t
i
n
u
m
m
o
c
l

a
c
o

t
r
o
p
p
u
S

✓ Atalaya Mining is

committed to responsible
mining and upholds its core
principles of honesty and
accountability.

✓ The Company works

with all stakeholders to
ensure that its values are
completely aligned with
the local community and
environment.

68 actions
programmes
through Fundación
Atalaya

2022 Achievements

✓ Operational

✓ Investment of €1.0 million
in local communities at
Proyecto Riotinto.

Risks

✓ External
Risks

✓ €3.4 million taxes paid

globally.

✓ Support for local

community events at
Proyecto Riotinto and
Proyecto Touro.

2023 Priorities

✓ Increase support

and presence in local
community projects
around Proyecto Riotinto
and Touro.

✓ Increase community
engagement in Touro.

Atalaya Mining Plc.

2022 Annual Report

0 5

Sustainability
Report

Atalaya Mining Plc

CONTENT 05:

5 . 1

Our Commitment to Sustainability

5 . 2

Good Governance and Responsible
Management

5 . 3

People

5 . 4

Safe Operations

5 . 5

Environment and Climate Change

5 . 6

Society

5 .7

Innovation and technology

Sustainability Report

Our Commitment to Sustainability

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

5.1

Our Commitment to
Sustainability

Atalaya Mining is committed to responsible metal production
throughout its value chain. Based on the business’s experience
and knowledge, the Company strives to achieve the best results by
impacting positively on employees, collaborators, local communities,
the environment, and all relevant stakeholders.

To achieve this, the Company is committed to
sustainable management of all its mining operations,
incorporating good governance criteria, care for the
environment and social responsibility.

Mining can generate significant socioenvironmental
impacts in the areas of operation. However, if properly
managed, risks can be mitigated and opportunities
seized, thus becoming an engine for generating
wealth, developing the human capital of the local
communities, and promoting environmental projects
that ensure the conservation of the environment for
future generations to enjoy. At the same time, mining
commodities such as copper play a key role in helping
society achieve a sustainable future.

Atalaya has developed its current operation in accord-
ance with the best ESG practices since the beginning
of its activity in 2015, offering the Riotinto Mining Basin
a mining project that has been a source of prosperity

and sustainable development for the region, having
achieved outstanding results since mining restarted.

Since 2021, Atalaya has had a formal corporate
Sustainability Policy. The Ten Principles of the UN
Global Compact act as the basis for the Company’s
corporate strategy. Among other topics, the policy
covers risk management, social and environmental
considerations, and corporate governance. It also
includes commitments to value chain accountability,
transparency, continuous innovation, and occupa-
tional health and safety.

Since the approval of this policy, the Company has
implemented incremental steps to further integrate
sustainability into every aspect of the organisation.

The first annual sustainability report issued on 25
April 2022 was an exercise of transparency where we
accounted for our performance in line with the GRI
(Global Reporting Initiative) reporting standards.

Atalaya Mining Plc.

Good Governance and Responsible Management

Sustainability Report

5.2

Good Governance and
Responsible Management

Atalaya Mining established a
Sustainability Committee on the
Board of Directors to promote
sustainability as a necessary
component for long-term success.

The committee will oversee ESG issues, set sustain-
ability strategy, and establish ambitious targets. The
company also implements an Integrated Manage-
ment System that ensures continuous improvement
in environmental performance, occupational health
and safety, and stakeholder needs. Atalaya Mining
complies with recognized corporate governance
codes, such as the QCA Code, to generate transpar-
ency, trust, credibility, and security.

Ethics

The Company is committed to operating ethically and
with corporate social responsibility. The company has
a Code of Business Conduct and Ethics that sets out
standards for ethical behaviour and is reviewed annu-
ally by the Board. Atalaya Riotinto Minera, S.L.U. also
has a grievance system for receiving complaints and
reports of possible breaches of the Code. The Whis-
tleblowing Channel is an external tool for maintaining
ethical compliance and enables the company to be
aware of any breaches and take prompt action. Atalaya
Mining has a Conflict of Interest Policy for its directors
to disclose any potential conflicts of interest.

Compliance management system

Atalaya has strengthened its ethics and compliance
systems in 2022, including updating the Code of Busi-
ness Conduct and Ethics and implementing a criminal
compliance system. The Compliance Policy and Crim-
inal Liability Prevention Manual have been approved,
and a Compliance Committee has been established
to oversee compliance issues within the company.
The criminal compliance system is integrated into
the Company’s Management System, and a risk map
has been created to assess potential criminal risks.
The Code of Business Conduct and Ethics explicitly
condemns child or forced labour and any other form

of labour exploitation or abuse, as well as discrimina-
tion based on various factors. The Compliance Policy
commits to zero tolerance for any illegal act and is
aligned with the company’s culture of integrity and
respect for rules. The Criminal Liability Prevention
Manual establishes a simple and effective system
for preventing, managing, and controlling actions
that may lead to the commission of offenses. A five-
member compliance committee has been established,
and training has been provided to key employees. The
company has also launched a communication action
for all employees explaining how the whistleblowing
channel works.

Risk prevention

Atalaya Mining plc operates in the mining industry
and is exposed to various risks that could significantly
affect its future operating results and the realization
of its objectives. Effective risk management is essen-
tial to reduce the potential impact on shareholder
returns, maintain employment, and protect the local
environment where the Group’s mining operations are
located.

To achieve this, Atalaya Mining plc has established
a Risk Management Policy, which is aimed at estab-
lishing an effective risk control and internal control
system. The company conducts an assessment of its
main risks, which are classified into four categories:
strategic, commercial and financial, legal and regula-
tory, and operational and external risks.

The Board of Directors is responsible for approving
and monitoring these assessments, while the Group
has adopted a financial risk management policy that
establishes key principles in managing its exposure
to financial risks. The policy’s objective is to support
the delivery of the Group’s financial targets while
protecting future financial security.

Senior management oversees the management of
financial risks with the support of the Audit & Finan-
cial Risk Committee. Proper management of these
risks is crucial for the Group’s success and positively
impacts stakeholders, reducing the potential impact
on shareholder return on investment, the maintenance
of employment, and the local environment where the
Group’s mining operations are located.

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

Atalaya Mining Plc.

Sustainability Report

People

5.3

People

Atalaya recognizes that its success depends on its employees, and as
a result, the company has made efforts to attract and retain talent by
improving working conditions and providing training.

Atalaya
employed
494
people in
2022

68%
of the workforce
comes from
neighboring
towns

82.39%
of contracts
are permanent

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

In 2022, Atalaya employed 494 people, primarily
at its Spanish operation affiliate, Atalaya Riotinto
Minera, S.L.U. While the majority of employees are
men, the Company has a higher proportion of female
employees than the industry average in Spain, and
82.39% of contracts are permanent. Atalaya’s objec-
tive is to maintain employment and improve the
living conditions of its workforce, and the Company
has prioritized the development of a trained and
effective workforce capable of sustaining growth.
The Company has implemented practical on-the-job
training systems to develop skills and prepare
personnel for future vacancies and substitutions, and
internal recruitment is prioritized to promote profes-
sional development and value the contributions of
employees who have participated in specific projects.
Atalaya plans to continue recruitment at ARM to stabi-
lize the workforce, and recruitment in other compa-
nies will depend on project progress. Atalaya Ossa
Morena and Masa Valverde are initiating recruitment
for research, exploration, and environmental work.

Equal opportunities and
non-discrimination

The Company is committed to effective people
management, particularly as the company has been
focused on recruiting and retaining employees in
recent years. This has involved developing policies for
employee selection, recruitment, training, assessment,
remuneration, and termination of employment, as well
as improving working conditions to attract and retain
talent. The company plans to consolidate all these poli-
cies into a single document, the Employee Guide.

The company is also committed to supporting the
socio-economic development of the local community
in the Riotinto Mining Basin. Atalaya Riotinto prior-
itizes local hiring for both employees and auxiliary
companies, which has resulted in a total of 2,355 work
positions generated by mining operations in the area,
representing 1.2% of total employment in the prov-
ince of Huelva in 2021. For every direct job created, six
additional jobs were generated in other sectors. The
mining industry itself had the most significant impact
on employment, followed by wholesale and retail
trade, administrative activities and additional services,
transport and storage, and professional, scientific, and
technical activities.

In 2022, Atalaya maintained its commitment to
hiring personnel from neighbouring villages, which
accounted for 68% of the company’s total workforce.
The company also has agreements with municipali-
ties to extend this promotion to contractors. Atalaya
Mining plc employs 72.5% of its workforce from the
provinces where its projects are located. Overall,
Atalaya is committed to effective people management
and supporting the socio-economic development of
its local community.

Dialogue with our employees

Atalaya values its employees and strives to create a
quality working environment. The company complies
with international labour standards and respects
human rights. Employee relations are managed under
applicable legislation, and a Works Council is used
to communicate with workers. The company also

Atalaya Mining Plc.

People

Sustainability Report

Talent development

Atalaya focuses on meeting business needs and
unlocking the potential of all employees. The
company has an Annual Training Plan covering legal
requirements and staff development needs. The
training is divided into four pillars: job development,
health and safety, environmental awareness, and
quality. The company also offers training for personal
development, such as human talent management
and conflict management. Atalaya also has a field
leadership program for a safe working environment.
The company partners with academic and business
organizations to promote the training of students and
improve employability in the mining basin.

Fair compensation

Atalaya Mining’s Code of Ethics promotes equal
opportunities in salary for all staff members. The
Collective Bargaining Agreement sets the remuner-
ation for employees, with a minimum wage increase
of 18.5% and a wage revision clause based on the CPI.
Executive personnel have specific conditions based
on critical Company objectives. Other benefits such
as study grants, reduced summer working hours, and
shift bonuses are offered equally to all employees.
Atalaya Mining plans to implement an employee
performance appraisal system in the future. The
company has agreed to undertake job evaluation and
commission a specialized company to evaluate it.

Conciliation and transparent
communication

Atalaya Riotinto Minera, S.L.U. is working on devel-
oping a corporate culture based on the company’s
values. Flexibility and transparent communication are
key elements in their value proposition. The company
offers various measures for family reconciliation,
including flexible working hours and remote work
during the COVID-19 crisis. They also offer a “No Absen-
teeism Bonus” to encourage commitment to work.
ARM has also made improvements to working condi-
tions such as medical insurance, a collective agree-
ment with different banking entities, and personalised
attention and assessment. The company has imple-
mented various internal communication mechanisms,
including a specific platform for internal communi-
cation and a periodic newsletter. Atalaya is imple-
menting a new tool, the “employee portal”, to improve
internal management and paper reduction. Atalaya
has an “Open Door Policy” to make relations between
employees and middle and senior management more
fluid. Finally, a working group was created to generate
initiatives to improve working environments from a
psychosocial point of view.

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

implements an open-door policy for communica-
tion at all levels. In 2022, a new Collective Bargaining
Agreement was negotiated and endorsed by Atalaya’s
workforce. It covers all employees of Atalaya Riotinto
Minera and includes measures to maintain purchasing
power and workers’ participation in profits generated
by the price of copper. The agreement also includes
improvements in conciliation and addresses aspects
related to the health and safety of workers. It was
signed in September 2022 and will be in force until
December 2026.

Atalaya Mining Plc.

5.4

Sustainability Report

Safe Operations

The Company is committed to safety and understands that
a safe and healthy working environment is critical to the
success of its operations. It is therefore firmly committed to the
continuous improvement of Health and Safety conditions in the
workplace and to achieve Zero Harm in its mining operation, as
established in its Occupational Health and Safety Policy.

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

To achieve this, the Company has an Occupational
Health and Safety Management System which is
externally certified against ISO 45001:2018. This
management system develops the principles and
commitments in the Occupational Health and Safety
Policy and extends to all personnel at Atalaya Riotinto,
including the contractor companies.

Certification in an international occupational health
and safety standard such as ISO 45001:2018, integrated
with the rest of the certified ISO standards of the
Company, allows a total transparency of the Compa-
ny’s processes and promotes continuous improvement
in risk prevention and preventive culture.

In addition, the Company receives legal compliance
audits every two years, also by an accredited external
body.

Atalaya Mining Plc.

Safe Operations

Sustainability Report

Safety culture

Atalaya understands that managing the behavioural
dimension of safety culture among employees is
essential as part of the preventative mechanism of
work-related accidents. A positive behaviour of safety
culture generally leads to safe production and opera-
tions in mining, produce a responsible miner, create a
safe workplace environment, and minimise accidents.

In this sense, the Company goes beyond training,
carrying out activities that reinforce Atalaya’s safety
culture, such as incorporating the 5-Whys, additional
training in Leadership in the field or the focus groups
for psychosocial factors.

In 2022, the Field Leadership Programme was consol-
idated with defined objectives within the integrated
management system. As a result, 26 groups made up
the Field Leadership Programme with 103 technicians
from all areas and departments. Once a month, they
carry out various preventive activities: audits, observa-
tions, inspections and stop and talk, among others.

COVID-19 Prevention
Strategy

Atalaya maintained the strategy at its facilities to
prevent the spread of COVID-19. This strategy ensured
that the good results achieved in 2020 and 2021,
which allowed the activity to be carried out safely,
were also completed in 2022. From the onset, the
implementation and monitoring of this strategy were
the responsibility of an emergency decision-making
committee and a monitoring committee with the
trade unions.

During the first half of the year 2022, the workers’
vaccination level was checked by the nursing service,
and the measures established by the Spanish Govern-
ment were followed. In this sense, related commu-
nications were made, the last one being to relax the
measures on the use of masks. Furthermore, the
nursing service has maintained early detection tests
for covid19 for all who request them.

Atalaya Mining recognises the importance of
disclosing safe and responsible management of the
tailings and the status of its Tailings Storage Facilities
(TSF) throughout the life cycle of these facilities (i.e.,
planning, design, construction, operation and refur-
bishment/decommissioning). These aspects are key to
our stakeholders.

Atalaya Mining recognises the importance of
disclosing safe and responsible management of the

tailings and the status of its Tailings Storage Facilities
(TSF) throughout the life cycle of these facilities (i.e.,
planning, design, construction, operation and refur-
bishment/decommissioning). These aspects are key to
our stakeholders.

The management of the Atalaya Riotinto TSF covers
the entire life cycle of the facility, from the design and
construction to closure and decommissioning at the
end of the mine’s life.

The Riotinto mine TSF began construction in the
1970s. It is one of the main TSFs in Europe due to its
size and the technical specification of its structure.
This uniqueness requires exhaustive control and
monitoring. Conscious of this Atalaya Riotinto imple-
mented in 2015 a new system that modernized the
facility and reinforce its structural safety.

Safe TSF Management and
Governance

Atalaya’s Major Accident Prevention Policy, signed by
the top management aims to reach the highest level
of protection and serves as the basis for the Safety
Management System implemented by the Company.

Atalaya Riotinto Minera, S.L.U.´s Technical Manage-
ment is in charge of ensuring compliance with
the regulations and basic mining safety standards
applicable to TSF. The Technical Management reports
directly to the Operations Management of Atalaya
Riotinto Minera and is the Company’s representative in
safety matters before the competent administration.

Atalaya’s governance procedures for its TSF manage-
ment represent 5 layers of prevention:

Geodetic and geotechnical sensor
network monitoring

Surveillance R+D technology
through Minerva Project

Internal staff inspections and
governance

Inspections by accredited third
parties

External reviews

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

Atalaya Mining Plc.

Sustainability Report

Environment and Climate Change

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

5.5

Environment
and Climate
Change

The Environmental Policy
adopted for Atalaya Riotinto
reflects Atalaya Mining plc’s
commitment to conducting its
mining activity on a sustainable
basis, minimizing any adverse
effects on the environment,
society, or culture.

Strict compliance with environmental
laws and regulations as well as with
other environmental commitments
that go beyond legal requirements are
key principles of this Policy. The Policy
incorporates an explicit commitment
to:

» Preventing pollution and ensuring

an efficient use of resources

» Using the best available techniques,

wherever possible

» Establishing mechanisms to

prevent situations of risk to the
environment

» Training and raising awareness of

employees and contractors on envi-
ronmentally friendly work

» Protecting, conserving, and

enhancing the value of historical
heritage

» Establishing measurable environ-
mental objectives and reviewing
them periodically

Atalaya Mining Plc.

Environment and Climate Change

Sustainability Report

A review was conducted in 2021 to highlight the fight
against climate change as one of the Company’s core
considerations, including the integration of the adap-
tation to climate change and the resilience as part of
the Company’s vision of continuous improvement.

The Company’s environmental management system
is certified against ISO 14001 to ensure stringent
adherence to the Environmental Policy. Annually, two
audits of the management system are performed: one
internal by company employees from various depart-
ments who have received the necessary training
as auditors, and the other externally by a licensed
company.

The Environmental Department ensures compliance
with these processes for environmental monitoring
such as control of natural resources consumption,
water cycle management, integrated management of
non-mining waste, storage of hazardous substances,
response to environmental emergencies, manage-
ment of atmospheric emissions, water quality control,
management of the natural environment, air quality
monitoring, and forest fire prevention.

Environmental Risk
Prevention

Environmental risk prevention is a critical aspect of
Atalaya Riotinto’s activities. Consequently, a specific
methodology has been defined and implemented to
prevent diverse situations that can cause accidents and
significant harm to the local environment as well as to
plan for the response to be provided to mitigate their
potential impact. This methodology is included in a
specific technical instruction within our Environmental
Management System. In addition, the Environmental
Department at Atalaya Riotinto is part of the Compli-
ance Committee.

Circular Economy and
Efficient Resource
Management

The appropriate management of waste is one of
Atalaya’s environmental priorities. Due to the volumes
generated, mining waste constitutes the most signif-
icant waste from our activities in addition, operations
produce non-mining waste, which is considered
hazardous and non-hazardous. Mining waste and
non-mining waste are managed differently, adopting
the requirements established for each by the appli-
cable legislation.

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

Atalaya Mining Plc.

Sustainability Report

Environment and Climate Change

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

It is important to highlight that the principles of
the circular economy are promoted in managing
mining waste, which is used for restoration and dam
reinforcement activities. Atalaya Riotinto uses the
enlargement of the tailings dam as an opportunity,
using the mine waste to construct reinforcements
and extensions to the various sections of the tailings
dam for process waste. This initiative allows the mine
waste to be reused, minimising their deposition on
surface and turning them to a new use. 22% of the
mining waste extracted from the mine in 2022 was
destined for works on the Tailings Storage Facility.

Another reusable fraction within the mining project
are the slates that are extracted from the mining
cut. These slates are an opportunity to promote the
Circular Economy, as they are an inert material that
can be used in mine restoration as a sealing material.
In 2022, a total of 630,000 tonnes of slate has been
earmarked for the sealing of passive waste dumps for
the restoration process.

Efficient Water
Management and Zero
Discharge Approach

The production process at Atalaya Riotinto, especially
the so-called “wet area” in the grinding and flotation
process, requires significant water consumption, so
water is a necessary resource for mining activity. It is
used in other processes such as dust control or for use
by employees.

Atalaya is aware that water is a common good, essen-
tial for the community in the hydrographic basin in
which we operate and that correct water manage-
ment is essential to generate trust in all stakeholders.

Atalaya therefore work every day to improve water use
efficiency and be resilient to the risks of water scarcity
from the effects of climate change.

Both the Sustainability Policy and the Environmental
Policy of Atalaya Riotinto are committed to the
efficient use of natural resources. The consumption
associated with each water source is controlled by
the Company’s technical services and supervised by
the Environmental Department reported directly to
Direction.

In addition, the water cycle is part of the integrated
management system certified under ISO 14001:2015
and is audited both internally and externally by
accredited bodies. Atalaya Riotinto has a water quality
control network both upstream and downstream of
the mining operation, including monthly sampling

and reports to the competent administration. In addi-
tion, Atalaya participates through Aminer in public
forums on water stewardship and management.

The copper extraction and production process at
Atalaya Riotinto uses both external and internal water
sources, the internal water source (recirculation) being
the one with the greatest weight, accounting for more
than 75% of the total required for ore processing.

Energy Transition and
Climate Change

At Atalaya, we include the fight against climate
change in our corporate and operational policies,
signed at the highest level of the Company.

At Atalaya, we have set ourselves a first climate objec-
tive: to reduce our greenhouse gas (GHG) emissions in
Atalaya Riotinto by 15% by 2025.

To achieve this milestone, we conduct an annual GHG
emissions inventory that is verified by an independent
third party. In 2022, we have expanded the scope of
this inventory to scope 3.

To meet this target, we have started construction
of a solar photovoltaic plant for self-consumption of
renewable energy at our Riotinto mining operation,
which will become operational in 2023.

Our commitment goes further, we are working to
develop a strategy that will enable us to align with
global climate targets, with a 2050 horizon.

Environmental Restoration
Plan

Since the beginning of its operation in 2015, Atalaya
has implemented a Restoration Plan, in accordance
with the Spanish legislation, aimed at the following
objectives:

» Landscape and environmental integration of the

areas created, preserving the values of the mining
landscape which is characteristic of the area, and
which is culturally protected.

» To guarantee adequate water quality in the restored

areas.

» To ensure the safety and long-term stability of the

remaining structures.

» To generate an end use of the land that is beneficial
for the socio-economic environment of the area
where the mining operation is located.

Atalaya Mining Plc.

Society

Sustainability Report

5.6

Society

Atalaya Riotinto Minera, S.L.U. is a driving force for the socio-economic
life of the Riotinto Mining Basin in the province of Huelva. ARM has a
notorious direct impact in the area, creating local employment and
wealth through its activity. It also has an indirect positive influence
due to the increase in production and employment in other economic
sectors stimulated by Atalaya’s activities, which generate new and
alternative demand. Moreover, the rise in household income increases
goods and services consumption and the training and employment of
the affected sectors.

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

make up the Riotinto Mining Basin (Minas de Riotinto,
Nerva, Berrocal, Campofrío, La Granada de Riotinto, El
Campillo and Zalamea la Real). This is an agreement in
which the signatory entities consolidate cooperation
between the local administrations and the mining
project, fostering administrative and other relations
between the parties.

The year 2022, the Fundación Atalaya Riotinto Minera,
financed more than €1 million between the seven
municipalities.

Atalaya maintains an open-door policy and a fluid
relationship with its stakeholders and promotes the
establishment of extensive communication channels
to provide maximum transparency with relevant and
accurate information about its activities The Company
identified that the relationship with stakeholders
differs in each mining project and is working to indi-
vidualise its actions with stakeholders in each case.
Based on the stakeholder concerns that were identi-
fied, the Company intensified its relations with these
groups.

Atalaya Riotinto Minera, S.L.U. is located within the
Riotinto-Nerva heritage area of Cultural Interest. The
Company is aware of preserving this legacy and its
continuity. To this end, ARM’s Environmental Policy
sets a commitment to prevent any negative cultural
impact and to protect, preserve and enhance the
value of the historical heritage. All these objectives are
managed within the Company’s Integrated Manage-
ment System and are subject to internal and external
audits.

According to this integrated approach, in 2022 a local
socioeconomic impact report was elaborated by an
independent consultant -Sintering, spin-off of Huelva
University-, analysing the local economic impact of the
mine with the consolidated economic data for the year
2021. The results shows that Atalaya Mining’s Riotinto
Project has generated more than 2,300 jobs and a
Gross Value Added of 305 million euros in the territory,
contributing more than 35 million euros in taxes and
investing almost 800,000 euros locally in social invest-
ment actions.

Since its creation, the Foundation develops Atalaya’s
Corporate Social Investment functions in its area of
influence, closely linked to the municipalities that form
part of the Riotinto Mining Basin.

The Atalaya Foundation collaborates through a frame-
work agreement with the seven municipalities that

Atalaya Mining Plc.

Sustainability Report

Environment and Climate Change

The year 2022, the
Fundación Atalaya
Riotinto Minera financed
more than

€1 million

between the seven
municipalities

Atalaya contributes to boosting the local and regional
economy through the purchases made from local
suppliers and the promotion of auxiliary companies
that increase their turnover, thanks to the creation of
synergies in the area.

Atalaya is committed to prioritising sourcing and
subcontracting from local companies in selecting
these providers. In 2022, 92.6% were national suppliers.

According to the socioeconomic impact report
prepared by the consultancy firm Sintering in 2021,

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

almost half (47.9%) of the purchases made by the
Company for the development of its activity are
concentrated in the province of Huelva. In comparison,
purchases from other Andalusian suppliers account
for 11.8% and 32.9% come from other Spanish regions.
Only 7.4% of supplies come from the foreign market.

Local procurements provides advantages in terms
of flexibility, risk mitigation and a quick response to
Company requests.

It also improves the local economy and brings value to
the area. Only in cases where the local supplier market
cannot meet the demand other national, European or
global suppliers are used.

The management approach to the relationship with
customers is part of the ISO 9001:2015 management
system, which allows us to assess satisfaction with
regard to meeting requirements and expectations,
implement systems to manage complaints, incidents
and claims and ensure that they are resolved.

In 2022, all objectives relating to customer contract
specifications and delivery times were met. On
specific occasions, if any element deviated from these
specifications, the company was informed sufficiently
in advance to avoid any incident.

Atalaya Mining Plc.

Society

Sustainability Report

5.7

Innovation and
technology

Innovation and the development of new
technologies provide an opportunity for Atalaya
to maintain and improve its competitiveness and
adopt the best practices in the copper market.

To efficiently manage these efforts, the Company has created a specific
working group composed of representatives from different departments.
This group meets monthly to discuss potential developments, national and
European projects and consortia for our membership, among other initia-
tives to deploy the Company’s innovation strategy.

Atalaya Mining Plc.

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

Innovation,
research and
development

Atalaya is committed to bringing
technology and innovation
together to improve our opera-
tions. Technology advances help
us achieve not only operational
objectives but also our goals to
create a safe and healthy work-
place and a more sustainable
business. One proof of this is
the implementation of ‘Minerva
#Smartgeocontrol’, a surveillance
platform that allows greater fore-
sight and prevention of potential
risks in real-time and remotely,
avoiding human error and
potential personnel and material
damage, minimising environ-
mental damage.

Digitalisation and
new technologies

For Atalaya Mining’s business,
it is essential to use Information
and Technology (IT) resources to
provide information at all levels.

Likewise, for the organisation to
achieve its objectives, it is neces-
sary to guarantee minimum
downtime, both in its IT resources
and in communications; in this
way, it is possible to maintain an
efficient contingency in all opera-
tional areas. Consequently, Atalaya
Mining plc has implemented a
Contingency and Cybersecurity
Plan to protect the Company from
these risks. This plan includes
annual security audits by a
specialised external company.

2022 Annual Report

0 6

Corporate
Governance
Report

Atalaya Mining Plc

CONTENT 06:

6 . 1

Board of Directors

6 . 2

Board Committees

6.1

Corporate Governance Report

Board of Directors

The Group and the Company give special attention to the application
of sound corporate governance policies, practices and procedures.
Corporate Governance is the set of procedures followed for the proper
management and administration of the Group. Corporate Governance
governs the relationship between the shareholders, the Board of
Directors and the management team of the Company.

Board structure

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

 Audit and Financial Risk Committee (“AFRC”)

Summary of Committee Responsibilities

Directors

✓ Reviews and monitors financial statements

Dr. Hussein Barma (Chair)

✓ Reviews Company’s public disclosure of financial information

✓ Reviews estimates and judgements that are material to reported financial

information

✓ Oversees the auditors’ arrangements and performance

✓ Reviews internal and external risks of the Company and internal controls

Mr. Roger Davey

Mr Neil Gregson

 Nomination and Governance Committee

Summary of Committee Responsibilities

Directors

✓ Succession planning for the Board and Management

Mr. Neil Gregson (Chair)

✓ Lead the process for Board appointments

✓ Reviews Corporate Governance of Atalaya and practices, independence,

charters’ review, and structure

Mrs. Kate Harcourt

Mr. Stephen Scott

 Physical Risk Committee (“PRC”)

Summary of Committee Responsibilities

Directors

✓ Oversees safety, health, environment and security matters of the Company

Mr. Stephen Scott (Chair)

✓ Oversees enterprise-wide physical risk management

✓ Reviews compliance with legal and regulatory obligations relating to safety,

health, and the environment

Mr. Neil Gregson

Mr. Jesus Fernandez

Mr. Roger Davey

Atalaya Mining Plc.

Board of Directors

Corporate Governance Report

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

 Remuneration Committee

Summary of Committee Responsibilities

Directors

✓ Reviews Directors’ compensation and performance

Mr. Neil Gregson (Chair)

✓ Compensation and performance of officers of Atalaya

Mrs. Kate Harcourt

Mr. Stephen Scott

 Sustainability Committee

Summary of Committee Responsibilities

Directors

✓ - Oversees the strategy and activities related to sustainable development and

Ms. Kate Harcourt (Chair)

social responsibility

✓ - Develop and review regularly the policies, programmes, practices, targets

and initiatives of the Group relating to Sustainability matters

Dr. Hussein Barma

Mr. Roger Davey

Atalaya Mining Plc.

Corporate Governance Report

Board of Directors

Directors

The names and particulars of the qualifications and experience of each director are set out
below. During 2022 one Non-independent Director stepped down and was replaced by one
independent Director. In accordance with the Company’s Articles of Association, one-third of
the Board of Directors must resign each year. All the Directors will resign at the next AGM and
offer themselves for re-election.

 Roger Davey
Non-executive Chair of the Board

Mr. Davey has over forty years’ experience in the mining industry. Previous employ-
ment included Assistant Director and Senior Mining Engineer at NM Rothschild
& Sons; Director, Vice President and General Manager of AngloGold’s subsidiaries
in Argentina; Operations Director of Greenwich Resources Plc, London; Produc-
tion Manager for Blue Circle Industries in Chile; and various production roles from
Graduate Trainee to Mine Manager, in Gold Fields of South Africa (1971 to 1978). Mr.
Davey is currently a director of Highfield Resources Ltd., Central Asia Metals plc and
Tharisa plc.

Mr. Davey is a graduate of the Camborne School of Mines, England (1970), with
a Master of Science degree in Mineral Production Management from Imperial
College, London University, (1979) and a Master of Science degree from Bourne-
mouth University (1994). He is a Chartered Engineer (C.Eng.), a European Engineer
(Eur. Ing.) and a Member of the Institute of Materials, Minerals and Mining (MIMMM).

Mr. Davey is the Chair of Atalaya’s Board of Directors and a member of the Audit
& Financial Risk Committee, the Physical Risk Committee and the Sustainability
Committee

Mr. Davey is the Chair of Atalaya’s Board of Directors and a member of the Audit
& Financial Risk Committee, the Physical Risk Committee and the Sustainability
Committee.

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

Name

Role

Roger Davey

Chair

Independent

Years of service

Since May 2010

Executive

Non-executive director

Time
commitment

At least 75% of meetings
scheduled

Skills

Mining experience, operations, processing,
exploration, Capital markets, UK Market,
International business, leadership, strategic,
fund raising, M&A, governance, project
management.

 Alberto Lavandeira
Managing Director and Chief Executive Officer

Name

Role

Alberto Lavandeira

Non-Independent -
Chief Executive Officer

Mr. Lavandeira brings over forty years of experience operating and developing
mining projects. He is a graduate of the University of Oviedo, Spain with a degree in
Mining Engineering.

Years of service

Since May 2014

Executive

Formerly, he was President, CEO and COO of Rio Narcea Gold Mines which built
three mines including Aguablanca and El Vallés-Boinas in Spain and Tasiast in
Mauritania. He was also involved in the key stages of development of the Mutanda
mine in the Democratic Republic of Congo. Earlier in his career, Mr. Lavandeira
worked within group companies of Anglo American, Rio Tinto and Cominco (now
Teck).

Mr. Lavandeira joined Atalaya in 2014. He is currently a director of Black Dragon
Gold Corp.

Time
commitment

100%

Skills

Mining experience, operations, processing,
exploration, commercial, capital market,
international business, leadership, strategic,
fund raising, M&A, governance, project
management, permitting, government rela-
tions, CEO, sustainability.

Atalaya Mining Plc.

Board of Directors

Corporate Governance Report

 Dr. Hussein Barma
Non-executive Director

Dr. Barma is a chartered accountant and qualified lawyer by background with over
20 years’ experience in senior positions in the mining sector. He brings to Atalaya
deep experience in accounting, internal control, governance, risk management,
and compliance. He has significant FTSE-50 senior executive experience, gained
over 15 years at Antofagasta plc, where he led its UK presence through a period of
change and growth as the UK-based chief financial officer. He has also had earlier
careers in professional services and academia. He is a non-executive Director of
Chaarat Gold Holdings Limited and Fidelity Asian Values PLC. He is also a principal
at Barma Advisory where he has worked on various assignments within the natural
resources and other sectors and an independent Governor of the University of the
Arts London.

Dr. Barma is the Chair of the Audit and Financial Risk Committee, and a member of
the Sustainability Committee.

 Neil Gregson
Non-executive Director

Mr. Gregson has over 30 years’ experience of investing in mining and oil and gas
companies. From 2010 to 2020 he was a Managing Director at J.P. Morgan Asset
Management where, as a member of the equity team, he was a portfolio manager
investing in mining and energy companies globally. Prior to that, from 1990 to 2009
he was Head of Emerging Markets and Related Sector Funds (including natural
resource funds) at Credit Suisse Asset Management. Mr. Gregson previously held
various positions at mining companies, including a role as a mining investment
analyst at Gold Fields of South Africa.

Mr. Gregson has a BSc (Hons) Mining Engineering from Nottingham University. He
became an associate of the Institute of Investment Management and Research
of London in 1994. He holds a Diploma in Business Management from Damelin
College, Johannesburg (1988) and a Mine Managers Certificate of Competency,
South Africa (1985).

Mr. Gregson is the Chair of the Remuneration Committee, Chair of the Nomination
and Governance Committee, member of the Physical Risk Committee and member
of the Audit and Financial Risk Committee.

Name

Role

Hussein Barma

Chair of the AFRC

Independent

Years of service

Since Sep 2015

Executive

Non-executive director

Time
commitment

At least 75% of meetings
scheduled

Skills

Mining experience, Corporate finance,
finance and accounting, legal, UK Market,
capital market, international business, lead-
ership, strategic, fund raising, M&A commu-
nications, sustainability.

Name

Role

Neil Gregson

Chair of the RC and NGC

Independent

Years of service

Since Feb 2021

Executive

Non-executive director

Time
commitment

At least 75% of meetings
scheduled

Skills

Mining experience, Corporate finance,
finance, legal, UK Market, capital market,
international business, leadership, stra-
tegic, fund raising, M&A communications,
sustainability.

 Jesus Fernandez
Non-executive Director

Mr. Fernandez is head of mergers and acquisitions for Trafigura. He joined Trafigura
in 2004 and has significant experience in the mergers and acquisitions field and
providing financing solutions for mining companies. He established the Trafigura
Group’s mining investment arm in 2005. He also acts as principal for Galena Private
Equity Resources Fund and is a Board member of a number of companies including
Trafigura Group’s mining division and Bowie Resources Partners.

Prior to joining Trafigura he worked in the project finance team at International
Power plc in London. Mr. Fernandez has a Master of Science degree (Finance and
Investment) from the University of Exeter and a Licenciatura (Economics degree)
from the Universidad de Cantabria, Spain.

Mr. Fernandez is member of the Physical Risk Committee.

Name

Role

Jesus Fernandez

Non-Independent

Years of service

Since Jun 2015

Executive

Non-executive director

Time
commitment

At least 75% of meetings
scheduled

Skills

Mining experience, Capital market, UK
Markets, International business, corporate
finance, finance and accounting, legal,
leadership, strategic, fund raising, M&A,
governance.

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

Atalaya Mining Plc.

Corporate Governance Report

Board of Directors

 Harry Liu
BSc. Economics - Non-executive Director

Mr. Liu is the advisor of the board of Shandong Xiangguang Copper Group at in
Shandong of China, one of the largest Chinese copper smelting, refining and fabri-
cating companies.

Mr. Liu has held a number of senior management and marketing positions in the
mineral and financial industries in Shanghai and Hong Kong, including roles as
Marketing Manager at BHP Billiton Marketing AG and Director at BNP Paribas Asia.

Mr. Liu graduated with a Bachelor´s Degree in Economics from Zhejiang University
in Zhejiang Province, China.

On 24 March 2022, the Company announced that Mr. Liu stepped down as an Inde-
pendent Non-Executive Director.

 Kate Harcourt
Non-executive Director

Mrs. Harcourt has extensive experience as independent sustainability consultant,
including ESG Officer and ESG Adviser, at a range of UK-linked mining companies,
including Cornish Lithium and Adriatic Metals, and has participated in several due
diligence projects for mining assets as part of a multidisciplinary team. Prior to
2010, was Director of Health, Safety, Environment, Communities and Securities at
Mag Industries, Senior Environmental Scientist at Golder Associates (UK) Ltd, Senior
Environmental Scientist at Wardell Armstrong and Environmental Scientist at SRK
(UK) Ltd. Mrs. Harcourt also sits on the board of Fortuna Silver Mines and Orezone
Gold Corporation.

Mrs. Harcourt is the Chair of the Sustainability Committee, a member of the
Remuneration Committee and a member of the Nomination and Governance
Committee.

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

 Stephen Scott
Non-executive Director

Mr. Scott is President and CEO of Entree Resources Limited. Previously, he was pres-
ident and CEO of Minenet advisors, advising on strategy, corporate development,
business restructuring and project management. He held various global executive
positions with the Rio Tinto Group (2000-2014). Mr. Scott is an experienced public
company director.

Mr. Scott is the Chair of the Physical Risk Committee, a member of the Remunera-
tion Committee and a member of the Nomination and Governance Committee.

Name

Role

Harry Liu

Non-Independent

Years of service

Since Oct 2010

Executive

Non-executive director

Time
commitment

At least 75% of meetings
scheduled

Skills

Commodity trading and financing, capital
market, international business, leadership,
strategic, fund raising, M&A, governance,
project management, permitting.

Name

Role

Kate Harcourt

Chair of the SC
Independent

Years of service

Since May 2022

Executive

Non-executive director

Time
commitment

At least 75% of meetings
scheduled

Skills

Mining experience, sustainability, health,
safety, environment.

Name

Role

Steve Scott

Chair of the PRC
Independent

Years of service

Since Sep 2015

Executive

Non-executive director

Time
commitment

At least 75% of meetings
scheduled

Skills

Mining experience, operations, processing,
exploration, capital market, international
business, leadership, strategic, fund raising,
M&A, governance, project management,
permitting, CEO.

Atalaya Mining Plc.

Board of Directors

Corporate Governance Report

Management

Alberto Lavandeira

Managing Director and Chief
Executive Officer

Mr. Lavandeira brings over forty years
of experience operating and devel-
oping mining projects. He is a grad-
uate of the University of Oviedo, Spain
with a degree in Mining Engineering.

Formerly, he was President, CEO
and COO of Rio Narcea Gold Mines
which built three mines including
Aguablanca and El Vallés-Boinas in
Spain and Tasiast in Mauritania. He
was also involved in the key stages of
development of the Mutanda mine in
the Democratic Republic of Congo.
Earlier in his career, Mr. Lavandeira
worked within group companies
of Anglo American, Rio Tinto and
Cominco (now Teck).

Mr. Lavandeira joined Atalaya in 2014.
He is currently a director of Black
Dragon Gold Corp.

Name:

Alberto Lavandeira

Role:

Chief Executive Officer

Years of service:

Since May 2014

Executive:

Executive

Time commitment:

100%

Skills:

Mining experience, operations,
processing, exploration, commer-
cial, capital market, international
business, leadership, strategic, fund
raising, M&A, governance, project
management, permitting, govern-
ment relations, CEO, sustainability.

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

Enrique Delgado

Operations - General Manager
Proyecto Riotinto

Former CEO of Tharsis Mining has
also performed as director of Metal-
lurgy and Environment at Cobre
Las Cruces Mine (First Quantum)
both in Spain. With First Quantum
also participated in the start-up of
Kansanshi Mine smelter in Zambia.
Started his career as metallurgist in
Riotinto Mine and later with Free-
port McMoRan, at Atlantic Copper
smelter in Huelva, Spain.

He is a graduate of the University of
Sevilla, Spain and Master of Senior
Management of Leading Companies
of the San Telmo International Insti-
tute of Sevilla, Spain.

Name:

Enrique Delgado

Role:

Operation General Manager
Proyecto Riotinto

Years of service:

Since May 2019

Executive:

Executive

Time commitment:

100%

Skills:

Mining experience, operations,
processing, exploration, inter-
national business, leadership,
strategic, governance, project
management and permitting.

Cesar Sanchez

Chief Financial Officer

Former CFO of companies in mining
and financial sectors; including CFO
of Iberian Minerals Corp. with copper
assets in Spain and Peru performing
equity and debt raisings. Worked for
Ernst & Young as financial advisor
and auditor. Qualified accountant,
holds a business administration
degree.

He is a graduate of the University of
Sevilla, Spain with courses in Dublin
City University and ESIC.

Name:

Cesar Sanchez

Role:

Chief Financial Officer

Years of service:

Since June 2016

Executive:

Executive

Time commitment:

100%

Skills:

Mining experience, Capital
markets, Canada and UK Markets,
International business, Corporate
finance, finance and accounting,
legal, leadership, strategic, fund
raising, M&A, governance.

Atalaya Mining Plc.

Corporate Governance Report

Board of Directors

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

Board Appointments

The Board is appointed by the shareholders
and Directors are chosen based on their
skill, experience and expertise. Directors
are always expected to be ambassadors for
the Company and reflect their values and
work ethic. They are also expected to devote
substantial time to research and prepara-
tion before each meeting to ensure that the
Company is going in the right direction.

Director Induction

When appointed, new Directors are provided with an
induction programme including meetings with other
Directors, members of the senior management team
and the Company’s professional advisors. They are
also briefed on their responsibilities under AIM. New
Directors are also provided with an opportunity to visit
the Company’s operations in Spain to understand how
Atalaya works on-site.

The Company requires its Directors to keep them-
selves professionally up-to-date and familiar with its
articles and charters.

Director Independence

The Board will be composed of at least the same
number of independent Directors (in accordance
with applicable securities laws and stock exchange
rules) as non-independent, non-executive Direc-
tors. The Nomination and Governance Committee
will determine whether a member of the Board, or
nominee to the Board, is an independent Director. If at
any time less than half of the non-executive Directors
are independent, the Board shall take steps to rectify
this and ensure that the composition of the Board
returns to having at least half independent Directors. If
at any time the Chair of the Board is not independent,
the Board shall consider possible steps and processes
to ensure that leadership is provided for the Board’s
independent Directors.

This ensures that all Board discussions or decisions
have the benefit of outside views and experience, and
that at least half of the non-executive Directors are
free of any interests or influences that could or could
reasonably be perceived to materially interfere with
the Director’s ability to act in the best interests of the
Company.

At least annually, the Board shall, with the assistance
of the Nomination and Governance Committee,
determines the independence of each director and
the independence of each Audit and Financial Risk
Committee member.

In the opinion of the Board, all Directors should bring
specific skills and experience that add value to the
Company. The balance of skills and experience of the
Board is to be regularly reviewed by the Nomination
and Governance Committee .

When considering the potential reappointment of an
existing Director, the Board will consider the individ-
ual’s performance as well as the skills and experience
mix required by the Board in the future.

When considering vacancies, the Board will consider
a candidate’s capacity to enhance the mix of skills and
experience of the Board.

Role of the Board

The Board has a duty to supervise the management
of the business and affairs of the Company. The Board
directly and with the Chair provide direction to senior
management, generally through the CEO, to pursue
the best interests of the Company.

The Board has the final responsibility for the
successful operations of the Company. The Board
must ensure that management has in place appro-
priate processes for strategic planning and risk assess-
ment, management and internal control and monitor
performance against benchmarks. The Board must
also ensure that the Company complies with all of its
contractual, statutory and any other legal obligations,
including the requirements of any regulatory body.

The Board is responsible for guiding and monitoring
the business and the affairs of the Company. The
Company recognises the importance of the Board in
providing a sound base for good corporate govern-
ance in the operations of the Company. The Board
must at all times act honestly, fairly and diligently in all
respects in accordance with the law applicable to the
Company. Furthermore, the Board will at all times act
in accordance with all Company policies in force.

Each of the Directors, when representing the
Company, must act in the best interests of share-
holders of the Company and in the best interests of
the Company as a whole.

Atalaya Mining Plc.

Board of Directors

Corporate Governance Report

Highlights of the
Board for this Year

Atalaya has had eight Board meetings
in which a wide array of subjects was
dealt with. When needed, its professional
advisors are invited to attend meetings
to provide input into legal and financial
matters.

Atalaya has also four Physical Risk
Committee meetings, five Audit and Finan-
cial Risk Committee meetings, six Corpo-
rate Governance, Nominating Committee
meetings, one Compensation Committee
meetings and one sustainability Committee
meeting.

These committee meetings were held to
deal with specifics and then a summary
of those meetings was reported to the
Board of Directors. A summary of the topics
discussed at Board and Committee meet-
ings included:

» On 1 November 2022, the Company

announced the establishment of the
Sustainability Committee and the
members of each of the five committees.

» Health and safety, reporting of accidents
and reviewing policy to look for improve-
ments including giving the go ahead on
a restructuring of the safety department.

» Operational, discussed all the opera-

tional information and data.

» Financial, reviewed figures such as cost,

capital investment, budgets, etc.

» Quarterly reports, annual report and
other deliverables to the Market.

» Re-election of Directors.

» Board and committees’ performance.

» Monitoring of expansion, review of
growth opportunities/acquisitions.

» Dividends policy.

The Board would like to thank the commit-
tees that have helped the Board reach its
conclusions.

The Role of Individual
Directors

As members of the Board, Directors have ultimate
responsibility for the Company’s overall success.
Therefore, Directors have an individual responsibility to
ensure that the Board is undertaking its responsibili-
ties as set out in the Board charters.

Directors need to ensure the following:

» Leadership of the Company, particularly in the areas
of ethics and culture including a clear and appro-
priate strategic direction.

» Accountability to key stakeholders, particularly

shareholders.

» Oversight of all control and accountability systems
including all financial operations and solvency, risk
management and compliance.

» An effective senior management team and appro-

priate personnel policies; and

timely and effective decisions on matters relating
to it.

It is also expected that the Directors comply with the
following:

» Behaving in a manner consistent with the words

and spirit of the Code of Conduct.

» Making reasonable efforts to attend all meet-

ings of the Board, the annual general meeting of
shareholders of the Company and of all the Board
committees upon which they serve. Subject to
extenuating circumstances, Directors are expected
to attend at least 75% of regularly scheduled Board
and committee meetings. The NGC will review
the circumstances that prevent any director from
achieving the minimum level and report its findings
to the Board.

» Addressing issues in a confident, firm and friendly
manner but also ensure that others are given a
reasonable opportunity to put forward their views.

» Preparing thoroughly for each Board or Committee

event.

» Using judgement, common sense and tact when

discussing issues.

Lastly Directors will keep confidential all Board discus-
sions and deliberations. Similarly, all confidential
information received by a Director in the course of the
exercise of the Director’s duties remains the property
of the Company and is not to be discussed outside the
boardroom. It is improper to disclose it, or allow it to
be disclosed, without appropriate authorisation.

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

Atalaya Mining Plc.

Corporate Governance Report

Board of Directors

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

Chair’s Role

The Chair is considered the “lead” Director and utilises
his/her experience, skills and leadership abilities to
facilitate the governance processes. The Chair will be
selected on the basis of relevant experience, skill and
leadership abilities.

The responsibilities of the Chair include but is not
restricted to:

» Chair Board, annual and extraordinary meetings;

» Set Board agendas and ensure that the meetings

are effective and follow the agenda;

» Ensure that the decisions are implemented

promptly;

The tasks of the CEO shall include but not restricted
to:

» Develop with the Board, implement and monitor
the short- medium- and long-term strategic and
financial plans for the Company to achieve the
Company’s vision and overall business objectives;

» Develop all financial reports, and all other mate-
rial reporting and external communications by
the Company, including material announcements
and disclosure, in accordance with the Company’s
Shareholder Communication Policy;

» Manage the appointment of the Chief Operating

Officer (“COO”), CFO, Company Secretary and other
specific senior management positions;

» Develop, implement and monitor the Company’s

» Ensure that the Board behaves in accordance with

risk management practices and policies;

the Company´s code of conduct

» The primary spokesperson and channel of commu-
nication for the Company in the annual general
meeting and in all public relation activities;

» To be kept informed by the CEO and other senior

management which may be relevant to Directors in
their capacity as Directors;

» Ensures Directors devote sufficient time to their

tasks

The Board monitors and promotes corporate culture
with frequent contact via senior management and the
CEO. Management and CEO report the state of the
culture to the Board and include any recommenda-
tions they have.

The Role of the CEO

The CEO is responsible for the attainment of the
Company’s goals and vision for the future, in accord-
ance with the strategies, policies, programmes and
performance requirements approved by the Board.
The position reports directly to the Board.

The CEO’s primary objective is to ensure the ongoing
success of the Company through being responsible for
all aspects of the management and development of
the Company. The CEO is of critical importance to the
Company in guiding the Company to develop new and
imaginative ways of winning and conducting business.
The CEO must have the industry knowledge and credi-
bility to fulfil the requirements of the role.

The CEO will manage a team of executives responsible
for all functions contributing to the success of the
Company.

» Consult with the Chair and the Company Secretary
in relation to establishing the agenda for Board
meetings;

» Agree with the Chair their respective roles in

relation to all meetings (formal and informal) with
shareholders and all public relations activities;

» Be the primary channel of communication and
point of contact between members of senior
management and the Board (and the Directors);

» Keep the Chair fully informed of all material

matters which may be relevant to the Board and its
members, in their capacity as Directors;

» Provide strong leadership to, and effective manage-

ment of, the Company in order to:

» Encourage co-operation and teamwork, build and
maintain staff morale at a high level and build and
maintain a strong sense of staff identity with, and a
sense of allegiance to, the Company;

» Advise the Board on the most effective organisa-

tional structure and overseeing its implementation;

» Establishing and maintaining effective and positive
relationships with Board members, shareholders,
customers, suppliers and other government and
business liaisons;

» Carry out the day-to-day management of the

Company.

The Role of Company
Secretary

The Company Secretary is charged with facilitating
the Company’s corporate governance processes and
so holds primary responsibility for ensuring that the
Board processes and procedures run efficiently and

Atalaya Mining Plc.

Board of Directors

Corporate Governance Report

effectively. The Company Secretary is accountable
to the Board, through the Chair, on all governance
matters and reports directly to the Chair as the repre-
sentative of the Board. The Company Secretary is
appointed and dismissed by the Board and all Direc-
tors have a right of access to the Company Secretary.

The tasks of the Company Secretary shall include but
not restricted to:

» Notifying the Directors in writing in advance of a
meeting of the Board as specified in the Constitu-
tion and the Board Charter;

» Recording, maintaining and distributing the

minutes of all Board and Board Committee meet-
ings as required;

» Preparing for and attending all annual and extraor-

dinary general meetings of the Company;

» Overseeing the Company’s compliance programme
and ensuring all Company legislative obligations are
met;

» Ensuring all requirements of regulatory bodies

are fully met; and providing counsel on corporate
governance principles and Director liability.

Board Diversity and Balance

Atalaya recognises the need to have a diverse board so that varying points of view can be brought to the board
table. It ensures its Directors are well qualified and have a range of different skills and experience, with a good
international mix to meet the requirements of operating in a global industry.

Executive

Gender

Nationality

Years of service

R. Davey

Independent Non-executive Chair

A. Lavandeira

Chief Executive Officer

H. Barma

Independent Non-executive Director

J. Fernández

Non-executive Director

H. Liu

S. Scott

Non-executive Director

Independent Non-executive Director

N. Gregson

Independent Non-executive Director

Male

British

Spanish

British

Spanish

Chinese

Since May 2010

Since May 2014

Since Sep 2015

Since Jun 2015

Oct 2010 to 24 March 2022

Canadian

Since Sep 2015

Australian

Since Feb 2021

K. Harcourt

Independent Non-executive Director

Female

British

Since May 2022

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

Atalaya Mining Plc.

Corporate Governance Report

Board of Directors

Board Meetings and
Attendance

The Board and Directors do not have fixed time require-
ments. They are expected to attend all meetings and be
sufficiently prepared with all issues that arise.

Atalaya’s decisions are predominantly made by
achieving a consensus at Board meetings. In excep-
tional circumstances, decisions may be taken by the
majority of Board members.

All Directors are required to take decisions objectively
and in the best interests of the Company. As part
of their duties as Directors, non-executive Directors
are expected to apply independent judgement to
contribute to issues of strategy and performance and
to scrutinise the performance of management.

The Board is scheduled to meet at least 8 times a year,
and at such other times as are necessary to discharge
its duties. The Board met a total of 8 times in 2022.
Meetings occurred in person and by teleconference.

BoD

AFRC

PRC

NGC

a
t
o
T

d
e
d
n
e
t
t
A

a
t
o
T

d
e
d
n
e
t
t
A

a
t
o
T

d
e
d
n
e
t
t
A

a
t
o
T

d
e
d
n
e
t
t
A

a
t
o
T

d
e
d
n
e
t
t
A

a
t
o
T

d
e
d
n
e
t
t
A

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

R. Davey

A. Lavandeira

H. Barma

J. Fernández

H. Liu

Neil Gregson

S. Scott

K. Harcourt

Board evaluation

Conflict of interest

The Remuneration Committee determines the
compensation of the directors of Atalaya, reviews the
compensation of the CEO and approves the compen-
sation of the other officers of Atalaya as recommended
by the CEO. The Remuneration Committee approves
the Company´s compensation policy as regards
base, short-term and long-term incentivisation and
ensure that the Company can recruit and retain high
quality Executives. The Nomination and Governance
Committee identifies potential candidates to become
members of the Board and fulfils the Board´s statutory
and fiduciary responsibilities with respect to corporate
governance and integrity. Meetings of the Committees
are held not less than three times year to enable the
Committee to undertake its role effectively.

Where an individual’s private interests are at variance
in any way with the interests of the Company as a
whole, a conflict of interest exists. Further, a conflict of
interest can be seen to exist where a staff member or
family member of staff, has a direct or indirect financial
interest in, or receives any compensation/other benefit
from, any individual or firm. Directors of the Company
shall disclose in writing conflicts of interest to the Board
or request to have entered in the minutes of meetings
of the Board the nature and extent of such interest.

Atalaya Mining Plc.

Board of Directors

Corporate Governance Report

Share dealing and insider
trading

Information technology
governance

Pursuant to Rule 21 of the AIM Rules for Companies, the
Company must have in place a reasonable and effective
dealing policy setting out the requirements and proce-
dures for dealings in the Company’s securities. AIM Rule
21 sets out the minimum provisions which the dealing
policy must contain. A Person Discharging Managerial
Responsibilities (“PDMR”) (any person who is member
of the administrative, management or supervisory body
of the Company or an Officer of the Company) may
not deal in any securities, on his or her own account
or for the account of a third party, directly or indirectly,
during: a close Period; or at any time when he or she is
in possession of Inside Information; or otherwise, where
clearance to deal is not given under the Clearance to
Deal policy.

Summary of the provisions of the Criminal Justice Act
1993 and the Market Abuse Regulation (596/2014/EU):
In addition to the rules set out in this Policy, there are
two principal pieces of legislation that PDMRs must
be aware of when dealing in both the securities of the
Company and securities in general. The Criminal Justice
Act contains a criminal offence of insider dealing and
Market Abuse Regulation covers market abuse. In broad
terms, there are three insider dealing offences: dealing
when in possession of inside information, encouraging
another person to deal when in possession of inside
information; and disclosing inside information other-
wise than in the proper performance of the functions
of the job. Inside information is information, which is
not public, relates to the securities in a company, and if
it were publicly known would have a significant effect
on the price of the shares/securities of that company.
This may include information about the Company, but it
may also include confidential information regarding the
intentions or prospects of someone the Company deals
with or a competitor of the Company.

Compliance

The Audit and Financial Risk Committee is responsible
for assisting the Board in overseeing the independence
of the external auditors and fulfilling the Boards’ statu-
tory and fiduciary responsibilities relating to the compli-
ance of financial reporting, reviewing and assessing the
Company’s business and financial risk management
process, including the adequacy of the overall internal
control environment and controls in selected areas
representing significant risk; and external Audit.

During the year 2022 there have not been identified any
material instances of non-compliance by the Company.

The Board assumes the responsibility for risks related
to the information technology (“IT”) systems and cyber
security. The IT department implements procedures to
avoid or solve any potential IT business impact.

Internal control system

The Directors have overall responsibility for the Group’s
internal control and effectiveness in safeguarding
the assets of the Group. Internal control systems are
designed to reflect the particular type of business,
operations and safety risks and to identify and manage
risks, but not to eliminate all risks completely to which
the business is exposed. As a result, internal controls
can only provide a reasonable, but not absolute, assur-
ance against material misstatements or loss.

The processes used by the Board to review the effec-
tiveness of the internal controls are through the Audit
and Financial Risk Committee and the senior manage-
ment, reporting to the Board on a regular basis where
business plans and budgets, including investments are
appraised and agreed. The Board also seeks to ensure
that there is a proper organisational and management
structure with clear responsibilities and accountability.
It is the Board’s policy to ensure that the management
structure and the quality and integrity of the personnel
are compatible with the requirements of the Group.

The Board attaches importance to maintaining good
relationships with all its shareholders and ensures
that all price sensitive information is released to all
shareholders at the same time in accordance with AIM
rules. The Company’s principal communication with its
investors is through the annual report and accounts,
the quarterly statements and press releases issued as
material events unfold.

Code of business ethic and
conduct

The Company is dedicated to delivering outstanding
performance for investors, customers, consumers and
its Staff. The Company aspires to be the leader in its
field while operating openly, with honesty, integrity and
responsibility and maintaining a strong sense of corpo-
rate social responsibility. In maintaining its corporate
social responsibility, the Company will conduct its busi-
ness ethically and according to its values, encourage
community initiatives, consider the environment and
ensure a safe, equal and supportive workplace.

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

Atalaya Mining Plc.

Corporate Governance Report

Board of Directors

2023 Annual General
Meeting

Atalaya’s AGM will be held on 22 June
2023 at 2:00pm in London (United
Kingdom). The business of the meeting
will be conducted in accordance with
regulatory requirements and standards.
The Chair of the Board and the Chairs
of the Committees will be available to
answer questions put to them by share-
holders at the meeting.

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

Atalaya is committed to delivering value to its share-
holders and to representing the Company’s growth
and progress truthfully and accurately. The Company
also complies with the spirit as well as the letter of all
laws and regulations that govern shareholders’ rights.

The Company is committed to safeguarding the
integrity of financial reporting and as such will
openly promote and instigate a structure of review
and authorisation designed to ensure the truthful
and factual presentation of the Company’s financial
position. The Company will prepare and maintain its
accounts fairly and accurately in accordance with the
accounting and financial reporting standards that
represent the generally accepted guidelines, princi-
ples, standards, laws and regulations of the countries
in which the Company conducts its business.

Modern slavery and human
trafficking

The Group is committed in respect of working condi-
tions and to removing potential modern slavery risks
relating to the business. Atalaya ensures that there
is no slavery or human trafficking further along its
supply chain and/or in any part of its business.

Anti-bribery and corruption
policy

It is Atalaya´s policy to conduct all of its business in an
honest and ethical manner and it takes a zero-toler-
ance approach to bribery and corruption. As Atalaya is
a UK listed company, it ensures compliance with the
UK Bribery Act 2010 (the “Bribery Act”).

The Anti-bribery and corruption policy applies to all
directors, officers, consultants, temporary workers
and employees of the Group and any other person
performing services for the Group or on its behalf, e.g.,
due to a contractual relationship, including but not
limited to distributors, contractors, agents, joint venture
and business partners, and other intermediaries.

Investor relations

The senior management of Atalaya is committed
to having regular interaction with investors on the
performance of the Group through presentations
and meetings. A broad range of documentation and
information for investors is available on the Company´s
website www.atalayamining.com and it is updated on
a regular basis.

Atalaya Mining Plc.

NGC - Nomination and Governance Committee

Corporate Governance Report

NGC

Nomination and Governance Committee

Members

Roger Davey

Neil Gregson (Chair)

Kate Harcourt

Hussein Barma

Stephen Scott

Attendance

5/5

1/1

0/1

5/5

6/6

The Role of the
Nomination and
Governance
Committee

The Company’s Nomi-
nation and Governance
Committee (“NGC”) is,
among other things,
responsible for reviewing
the performance of the
executives, setting their
remuneration, determining
the payment of bonuses,
considering the grant of
options under any share
option scheme and, in
particular, the price per
share and the application
of performance standards
which may apply to any
such grant.

Remuneration arrangements are
aligned to support the implemen-
tation of the Company strategy
and effective risk management
for the medium to long-term. The
remuneration committee ensures
that this is done and considers the
views of shareholders.

The Committee makes recom-
mendations for Board review.
The Committee shall have such
powers and duties as may be
conferred on it from time to time
by resolution of the Board. In addi-
tion, the Committee shall have the
following specific functions and
responsibilities:

» The Committee shall period-
ically review and, if advisable,
approve and recommend for
Board approval the compensa-
tion paid to Directors.

» At least annually, and prior to
the nomination or appoint-
ment of potential candidates,
the Committee shall review the
competencies, skills, experi-
ence and areas of expertise of
the Board on an individual and
collective basis. Based on this
review, the Committee shall
identify areas where additional
competency, skill, experience
or expertise would be of benefit
to Atalaya Mining.

» As required, the Committee

shall identify and, if advisable,
recommend to the Board for
approval, potential candidates
for nomination or appointment
to the Board having regard
to the results of the review

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

referred to above. The Board
should consider whether or
not each new nominee can
devote sufficient time and
resources to his or her duties as
a Committee member.

» The Committee shall peri-

odically assess the contribu-
tion and effectiveness of the
Board, the Directors, each
Board Committee and the
Chair of the Board against
their respective mandate,
charters or other criteria the
Committee considers appro-
priate. The Committee shall
report its findings to the Board
and, based on those findings,
recommend any action plans
that the Committee considers
appropriate.

» The Committee shall oversee

the development of any
orientation programmes for
new Directors. The Committee
shall periodically review
any such programme and
approve changes it considers
appropriate.

» The Committee shall period-
ically review Atalaya Mining’s
corporate governance prac-
tices and policies. As part of its
review, the Committee shall
take regulatory requirements
and best practices, including
the UK Corporate Governance
Code and QCA guidelines, into
account. The Committee shall
report the results of its review,
including any recommended
changes to existing prac-
tices, to the Board in a timely
manner.

Atalaya Mining Plc.

Corporate Governance Report

NGC - Nomination and Governance Committee

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

» The Committee will also estab-
lish and maintain a complaints
programme to facilitate (1) the
receipt, retention and treat-
ment of complaints received
by the Company regarding its
Accounting Standards, viola-
tions of the Code of Business
Conduct and Ethics and the
Anti-Bribery and Corruption
Policy, breaches in compliance
with applicable laws including
relating to health and safety
or the environment and (2)
the confidential, anonymous
submission by employees of
the Company of any complaints
made in these areas.

» At least annually, the

Committee shall evaluate
each Director and each Audit
and Financial Risk Committee
member against the independ-
ence criteria established by the
UK Corporate Governance Code
and report the results to the
Board.

» The Committee shall review, in

conjunction with management,
the corporate governance
disclosure for Atalaya Mining’s
annual report, notice of share-
holders meetings and other
regulatory and shareholder
reports.

» The Committee shall period-
ically review and, if advisable,
approve and recommend for
Board approval performance
goals for the CEO in light of the
Company’s corporate goals and
objectives.

» The Committee shall periodi-

cally evaluate the performance
of the Chief Executive Officer
in relation to his or her perfor-
mance goals. The Chief Execu-
tive Officer evaluation shall be
conducted in conjunction with
the Chair of the Board and shall

be presented to the Board for
its review.

» The Committee shall periodi-
cally review, and, if advisable,
approve and recommend for
Board approval the Chief Exec-
utive Officer’s compensation
package. The compensation
package recommendation
shall be based on the CEO’s
evaluation, as well as other
factors and criteria as may be
determined by the Committee
from time to time.

» The Committee shall, as

required, review and, if advis-
able, approve and recommend
for Board approval, the appoint-
ment, compensation and other
terms of employment of all
senior management reporting
directly to the CEO.

» The Committee shall period-
ically review and, if advisable,
approve and recommend for
Board approval, a succession
and emergency preparedness
plan for all senior management
reporting directly to the CEO.
Upon the vacancy of such
senior management personnel,
the Committee may make a
replacement recommendation
for Board approval based on
the succession plan.

» The Committee shall period-
ically review the Company’s
existing share option plan and
make any recommendations to
the Board regarding the plan
as it considers advisable. The
Committee shall also review
any proposed equity compen-
sation grants (other than
pursuant to the existing plan),
programmes or plans.

The NGC comprises three
members all of whom are non-ex-
ecutive and Independent. The
current membership of the
committee is Mr. N. Gregson
(Chair), Mrs. K. Harcourt and Mr. S.
Scott.

Corporate Governance

The Directors comply with
AIM regulations and Cyprus
Company Law. The Board remains
accountable to the Company’s
shareholders for good corporate
governance.

2022 Review

The Committee met six times
during 2022, covering a number of
issues.

Atalaya keeps the balance and
membership of its Board under
review and no new appointments
were made during the year. All
Directors were re-elected at the
last Annual General Meeting
during 2022.

Neil Gregson

Chair of Corporate Governance,
Nominating and Compensation
Committee

21 March 2023

Atalaya Mining Plc.

PRC - Physical Risks Committee

Corporate Governance Report

PRC

Physical Risks Committee

Members

Stephen Scott (Chair)

Neil Gregson

Roger Davey

Jesus Fernandez

The Role of the
PRC

The function of the PRC is
oversight. It is recognised
that members of the PRC
who are Non-Executive
Directors are not full-time
employees of the Company
and generally do not repre-
sent themselves as experts
in the fields of safety,
health, environment, secu-
rity or risk management. As
such, it is not the responsi-
bility of the PRC personally
to conduct safety, health,
environment, security or
risk reviews.

Committee members are entitled
to rely on Atalaya Mining Manage-
ment with respect to matters
within their responsibility and on
external professionals on matters
within their areas of expertise.

Committee members may
assume the accuracy of informa-
tion provided by such persons,
so long as the members are
not aware of any reasonable

Attendance

2022 Review

The PRC had four meetings in the
year which covered a number of
issues. These included meetings
on site which covered health
and safety issues and risk areas.
Health and safety are a key priority
to ensure a safe working environ-
ment for both employees and
contractors and the Company
is focused on ensuring it meets
all regulations and assesses risk
factors on a regular basis.

I would like to thank the safety
department personnel, in
particular, for their contributions
and suggestions to continually
make our operations safer.

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

Stephen Scott

Chair of Physical Risks Committee

21 March 2023

4/4

0/1

grounds upon which such reli-
ance or assumption may not be
appropriate.

Management is responsible
for implementing, managing
and maintaining appropriate
enterprise-wide safety, health,
environment, security and risk
management systems, policies
and procedures, reporting proto-
cols and internal controls that
are designed to ensure compli-
ance with applicable laws and
regulations. Management is also
responsible for the preparation,
presentation and integrity of
the information provided to the
Committee.

The PRC comprises three
members all of whom are non-ex-
ecutive and Independent. The
current membership of the
committee is Mr. S. Scott (Chair),
Mr. R. Davey, Mr. J. Fernandez and
Mr. N. Gregson.

Atalaya Mining Plc.

Corporate Governance Report

AFRC - Audit and Financial Risk Committee

AFRC

Audit and Financial Risk Committee

Indemnification of Directors and
Officers

During the year, the Company held insurance to indemnify Directors, the
Company Secretary and its executive officers against liabilities incurred
in the conduct of their duties to the extent permitted under applicable
legislation..

Members

Hussein Barma (Chair)

Neil Gregson

Roger Davey

Attendance

5/5

2/2

5/5

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

The Role of the
AFRC

The Company’s Audit and
Financial Risk Committee
(“AFRC”) is responsible for
ensuring that appropriate
financial reporting proce-
dures are properly main-
tained and reported on, for
meeting with the Group’s
auditors and reviewing
their reports on the Group’s
financial statements and
the internal controls and
for reviewing key financial
risks.

The AFRC is responsible for
assisting the Board in overseeing
the independence of the external
auditors and fulfilling the Boards’
statutory and fiduciary responsibil-
ities relating to:

» Financial reporting;

» Reviewing and assessing the

Company’s business and finan-
cial risk management process,
including the adequacy of the
overall internal control environ-
ment and controls in selected
areas representing significant
risk; and

» External Audit.

To fulfil these functions the AFRC
shall have the following duties and
responsibilities:

» To review the quality and
integrity of all published
financial statements and
reports including the annual
Management Discussion and
Analysis report (if applicable)
and quarterly earnings press
releases issued by the Company,
prior to the Company publicly
disclosing the information, as
well as all other material contin-
uous disclosure documents and

analysis with a view to making a
recommendation to the Board.

» To review estimates and judge-
ments that are material to
reported financial information
and consider the quality and
acceptability of the Company’s
accounting policies and proce-
dures and the clarity of disclo-
sure in financial statements.

» To ensure compliance by the

Company with legal and regu-
latory requirements related to
financial reporting.

» To review and to recommend to
the Board the nomination and
appointment of the external
auditor for the purposes of
preparing or issuing an audi-
tors’ report or performing other
audit, review or attest services
and to recommend to the
Board the compensation of the
external auditor.

» To review the qualifica-
tions, performance and

Atalaya Mining Plc.

AFRC - Audit and Financial Risk Committee

Corporate Governance Report

independence of the external
auditor, to consider the auditor’s
recommendations and manage
the relationship with the
auditor, which includes meeting
with the external auditor as
required in connection with the
audit services provided and to
review the engagement letter
of the external auditor.

» To oversee the work of the

external auditor engaged for
the purposes of preparing or
issuing an auditor’s report
or performing other audit,
review or attest services for the
Company, including the resolu-
tion of disagreements between
management and the external
auditor regarding financial
reporting.

» To meet with the external

auditor to discuss the annual
financial report and any trans-
action referred to in the Board
Charter.

» To provide the external auditor

with the opportunity to
meet with the AFRC without
management present at least
once per year for the purpose of
discussing any issues.

» To review the quality and integ-
rity of the internal controls and
accounting procedures of the
Company including reviewing
the Company’s procedures for
internal control.

» To identify risks inherent in the
business of the Company and
to review the Company’s risk
management procedures.

» To review and approve the
Company’s hiring policies
regarding partners, employees
and former partners and
employees of the present and
former external auditor of the
Company.

» To review any significant,

2022 Review

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

The AFRC met five times during
2022. Five meetings were timed
to coincide with the approval of
financial results for publication
with one meeting held as a plan-
ning meeting for year-end.

During the year, the AFRC
maintained regular dialogue
with management as well as the
external auditors, both within
and outside of formal committee
meetings. The principal matters
considered by the AFRC during
the year and in its discussions with
management and the external
auditors included:

» Review and approval of the
quarterly, half yearly and full
year financial results.

» The going concern statement
in the Management Report
above and in Note 2.1(b) to the
Financial Statements,.

» Key accounting and audit
matters for 2022 including
Revenue Recognition.

» An internal evaluation of the
AFRC’s performance with
feedback from board members,
senior management and the
external auditors.

» A review of the AFRC’s Terms
of Reference to ensure that it
remained fit for purpose and
that the AFRC complied with its
responsibilities.

Hussein Barma

Chair of Audit and Financial Risk
Committee

21 March 2023

including any pending, trans-
actions outside the Company’s
ordinary course of business and
any pending litigation involving
the Company.

» To review and monitor manage-

ment’s responsiveness to
external audit findings or any
regulatory authority.

» To report to the Board of

Directors, who in turn may refer
the matter to the Corporate
Governance, Nominating and
Compensation Committee,
any improprieties or suspected
improprieties with respect to
accounting and other matters
that affect financial reporting
or the integrity of the business.

In addition, the AFRC shall
establish procedures for the
receipt, retention and treatment
of complaints (including “whis-
tleblowing” complaints) received
by Atalaya Mining regarding risk
management, legal/regulatory
compliance, accounting, internal
accounting controls or auditing.
This is to include a process
for confidential anonymous
complaints by employees or other
stakeholders.

The AFRC comprises three
members all of whom are
non-executive and Independent.
The current membership of
the committee is Dr. H. Barma
(Chair), Mr. R. Davey and Mr. N.
Gregson. The secretary, CEO and
CFO and external auditors also
attend in when requested by the
Committee.

Atalaya Mining Plc.

Corporate Governance Report

RC - Remuneration Committee

Remuneration Committee

Indemnification of Directors and
Officers

Members

Neil Gregson (Chair)

Kate Harcourt

Stephen Scott

Attendance

1/1

0/1

1/1

The Role of the RC

The Company’s Nomination and Governance Committee
(“NGC”) is, among other things, responsible for reviewing
the performance of the executives, setting their remuner-
ation, determining the payment of bonuses, considering
the grant of options under any share option scheme and, in
particular, the price per share and the application of perfor-
mance standards which may apply to any such grant.

» The Committee shall period-
ically review and, if advisable,
approve and recommend for
Board approval the compensa-
tion paid to Directors.

» At least annually, and prior to

the nomination or appointment
of potential candidates, the
Committee shall review the
competencies, skills, experience

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

Atalaya Mining Plc.

RC - Remuneration Committee

Corporate Governance Report

and areas of expertise of the
Board on an individual and
collective basis. Based on this
review, the Committee shall
identify areas where additional
competency, skill, experience or
expertise would be of benefit to
Atalaya Mining.

» As required, the Committee

shall identify and, if advisable,
recommend to the Board for
approval, potential candidates
for nomination or appointment
to the Board having regard
to the results of the review
referred to above. The Board
should consider whether or not
each new nominee can devote
sufficient time and resources to
his or her duties as a Committee
member.

» The Committee shall period-
ically assess the contribution
and effectiveness of the Board,
the Directors, each Board
Committee and the Chair of
the Board against their respec-
tive mandate, charters or
other criteria the Committee
considers appropriate. The
Committee shall report its find-
ings to the Board and, based on
those findings, recommend any
action plans that the Committee
considers appropriate.

» The Committee shall oversee

the development of any
orientation programmes for
new Directors. The Committee
shall periodically review
any such programme and
approve changes it considers
appropriate.

Code and QCA guidelines, into
account. The Committee shall
report the results of its review,
including any recommended
changes to existing practices, to
the Board in a timely manner.

» At least annually, the Committee
shall evaluate each Director and
each Audit and Financial Risk
Committee member against
the independence criteria
established by the UK Corporate
Governance Code and report
the results to the Board.

» The Committee shall review, in

conjunction with management,
the corporate governance
disclosure for Atalaya Mining’s
annual report, notice of share-
holders meetings and other
regulatory and shareholder
reports.

» The Committee shall period-
ically review and, if advisable,
approve and recommend for
Board approval performance
goals for the CEO in light of the
Company’s corporate goals and
objectives.

» The Committee shall periodi-

cally evaluate the performance
of the Chief Executive Officer

in relation to his or her perfor-
mance goals. The Chief Execu-
tive Officer evaluation shall be
conducted in conjunction with
the Chair of the Board and shall
be presented to the Board for
its review.

» The Committee shall periodi-
cally review, and, if advisable,
approve and recommend for
Board approval the Chief Exec-
utive Officer’s compensation
package. The compensation
package recommendation shall
be based on the CEO’s evalua-
tion, as well as other factors and
criteria as may be determined
by the Committee from time to
time.

» The Committee shall, as

required, review and, if advis-
able, approve and recommend
for Board approval, the appoint-
ment, compensation and other
terms of employment of all
senior management reporting
directly to the CEO.

» The Committee shall period-
ically review the Company’s
existing share option plan and
make any recommendations to
the Board regarding the plan
as it considers advisable. The
Committee shall also review any
proposed equity compensation
grants (other than pursuant to
the existing plan), programmes
or plans.

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

Atalaya Mining Plc.

Corporate Governance Report

RC - Remuneration Committee

Directors’ Emoluments

In compliance with the disclosure requirements of the listing requirements of AIM, the aggregate remuneration
paid to the Directors of Atalaya Mining Plc for the year ended 31 December 2022 is set out below:

(Euro 000’s)

31 Dec 2022

Executive Directors

A. Lavandeira

Non-executive Directors

R. Davey

H. Barma

J. Fernández

H. Liu

K. Harcourt

S. Scott

N. Gregson

Salary & Fees

Bonus

Incentive options*

Total

Short term benefits

488

357**

426

143

91***

1,028

357

426

1,271

143

91***

1,810

(*) The amount relates to the non-cash expense recognised in accordance with IFRS 2 Share-based payments. On 22 June 2022, the
Company granted 400,000 share options to the Executive Director Alberto Lavandeira (see Note 22 to the financial statements).

(**) These amounts related to the performance bonus for 2021 approved by the Board of Directors of the Company during H1 2022. Director’s
bonus relates to the amount approved for the CEO as an executive director and key management bonus relates to the amount approved for
other key management personnel which are not directors of Atalaya Mining plc. Bonuses for 2020 were approved and paid in H2 2021.

(***) Includes €4k paid to the Canadian Pension Plan.

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

(Euro 000’s)

31 Dec 2021

Executive Directors

A. Lavandeira

Non-executive Directors

R. Davey

D. Barber

H. Barma

J. Fernández

H. Liu

J. Sierra López

S. Scott

N. Gregson

Salary & Fees

Bonus

Incentive options*

Total

Short term benefits

472

134

97***

1,019

438**

321

1,231

438

321

134

97***

1,778

(*) The amount relates to the non-cash expense recognised in accordance with IFRS 2 Share-based payments. On 30 June 2021 the Company
granted 400,000 share options to the Executive Director Alberto Lavandeira (see Note 22).

(**) These amounts in 2021 related to the performance bonus for 2020 approved by the CGNC Committee of the Company during H1 2021.
Director’s bonus relates to the amount approved for the CEO as an executive director.

(***) Includes €7k paid to the Canadian Pension Plan.

Atalaya Mining Plc.

RC - Remuneration Committee

Corporate Governance Report

Directors’ Interests

The interests of the Directors and their immediate families, (all of which are beneficial unless otherwise stated) and
of persons connected with them, in Ordinary Shares, as at 31 December 2022 and 2021, are as follows:

Name

A. Lavandeira

J. Fernández(1)

H. Liu(2)

2022

2021

No. of existing
Ordinary Shares

% of issued Share
Capital

No. of existing
Ordinary Shares

% of issued Share
Capital

430,000

30,821,213*

-**

0.31%

22.03%

280,000

30,821,213*

31,075,251**

0.20%

22.30%

22.48%

(1) Urion Holdings (Malta) Ltd

(2) Yanggu Xiangguang Copper Co. Ltd

(*) Shares held by the companies the Directors represent

(**) 2021 included 369,019 shares held personally by Mr. Liu.

The interest percentage represents the percentage of voting rights.

Directors’ Share Options

2022 Review

The Directors to whom options over ordinary shares have been granted
and the number of ordinary shares subject to such options (post share
consolidation figures) as at the balance sheet date are as follows:

The Committee met one time
during 2022, covering a number of
issues.

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

Grant Date

Expiration Date

Exercise Price

A. Lavandeira

29 May 2019

28 May 2024

30 June 2020

29 June 2030

24 June 2021

23 June 2031

22 June 2022

30 June 2027

201.5p

147.5p

309.0p

357.5p

600,000

400,000

1,800,000

There were no further option grants between the balance sheet date and
the date of this report.

Options expire five/ten years after grant date and are exercisable at the
exercise price in whole or in part up to either (i) half on grant and half on
the first anniversary of the grant, or (ii) one third on grant, one third on
the first anniversary of grant and one third on the second anniversary of
grant.

Atalaya always bases their remu-
neration packages in comparison
with their peers in the mining
sector and in companies of similar
size and similar financials.

Neil Gregson

Chair of Remuneration Committee

21 March 2023

Atalaya Mining Plc.

Corporate Governance Report

SC - Sustainability Committee

Sustainability Committee

Indemnification of Directors and
Officers

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

Members

Kate Harcourt (Chair)

Hussein Barma

Roger Davey

The Role of the
SC

The Sustainability
Committee is responsible
of strategy and activities
related to sustainable devel-
opment and social responsi-
bility, in particular:

» review, monitor and assist the
Board in defining the Group’s
strategy relating to Environ-
mental, Sustainability and
Social matters and in setting
relevant KPIs;

» develop and review regularly
the policies, programmes,
practices, targets and initia-
tives of the Group relating to
Sustainability matters ensuring
they remain effective and up to
date and consistent with good
international industry practice
(“GIIP”);

Attendance

1/1

» provide oversight of the Group’s
management of Sustainability
matters and compliance with
relevant current and forth-
coming legal and regulatory
requirements, legislation and
policies as the relate to Envi-
ronmental, Sustainability and
Social, including, but not limited
to applicable rules and princi-
ples of corporate governance
relating to Environmental,
Sustainability and Social
aspects questions regarding
climate change, tailings
management, water manage-
ment, human rights and other
applicable industry standards;

» report on these matters to the
Board and, where appropriate,
make recommendations to the
Board;

» to review public reporting

» to provide oversight of the
Company’s sustainability
performance presented in any
Sustainability Report prepared
by the Company;

» report as required to the share-
holders of the Company on
the sustainability activities and
remit of the Committee;

» Responsible for oversight

of sustainability risks of the
Company.

2022 Review

On 1 November 2022, the BoD
established the Sustainability
Committee. The Committee met
one time during 2022, covering a
number of issues.

Kate Harcourt

relating to the Company’s safety
and sustainability performance

Chair of the Sustainability
Committee

21 March 2023

Atalaya Mining Plc.

SC - Sustainability Committee

Corporate Governance Report

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

Atalaya Mining Plc.

2022 Annual Report

0 7

Consolidated
and Company
Financial
Statements

Atalaya Mining Plc

CONTENT 07:

7. 1

Independent Auditor’s Report

7. 2

7. 3

Consolidated and Company Financial
Statements

Notes to the Consolidated and Company
Financial Statements

102

110

Consolidated and Company Financial Statements

Independent Auditor’s Report

7.1

Independent Auditor’s
Report

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

Atalaya Mining Plc.

Independent Auditor’s Report

Consolidated and Company Financial Statements

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

Atalaya Mining Plc.

Consolidated and Company Financial Statements

Independent Auditor’s Report

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

Atalaya Mining Plc.

Independent Auditor’s Report

Consolidated and Company Financial Statements

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

Atalaya Mining Plc.

100

Consolidated and Company Financial Statements

Independent Auditor’s Report

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

Atalaya Mining Plc.

Independent Auditor’s Report

Consolidated and Company Financial Statements

101

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

Atalaya Mining Plc.

102

Consolidated and Company Financial Statements

7.2

Consolidated and
Company Financial
Statements

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

Atalaya Mining Plc.

Consolidated and Company Financial Statements

103

Consolidated and Company Statements of Comprehensive Income

For the year ended 31 December 2022

(Euro 000’s)

Revenue

The
Group

The
Company

The
Group

The
Company

Note

2022

2021

361,846

57,756

405,717

65,849

Operating costs and mine site administrative expenses

(288,275)

Mine site depreciation, amortisation and impairment

13,14

(34,119)

Gross profit

Administration and other expenses

Share based benefits

Exploration expenses

Care and maintenance expenditure

Other income

Operating profit

Net foreign exchange gain

Interest income from financial assets at fair value through profit and loss

Interest income from financial assets at amortised cost

Finance costs

Profit before tax

Tax

Profit for the year

Profit for the year attributable to:

» Owners of the parent

» Non-controlling interests

39,452

(9,954)

(1,279)

(4,257)

(3,053)

286

21,195

11,546

624

(1,045)

32,320

(1,394)

30,926

33,155

(2,229)

30,926

57,756

(3,601)

286

(192,073)

(32,276)

181,368

(9,715)

(899)

(1,800)

(2,116)

54,441

166,838

3,439

9,157

3,779

70,816

(617)

70,199

6,589

(13,657)

159,827

(27,601)

132,226

65,849

(2,422)

63,427

1,450

12,854

2,398

80,129

(862)

79,267

70,199

133,644

79,267

(1,418)

70,199

132,226

79,267

Earnings per share from operations attributable to equity holders of the parent during the year:

Basic earnings per share (EUR cents per share)

Diluted earnings per share (EUR cents per share)

23.7

23.2

96.7

94.4

Profit for the year

Other comprehensive income:

30,926

70,199

132,226

79,267

Other comprehensive income that will not be reclassified to profit or loss in subsequent periods (net of tax):

Change in fair value of financial assets through other comprehensive
income ‘OCI’

Total comprehensive income for the year

Total comprehensive income for the year attributable to:

» Owners of the parent

» Non-controlling interests

(6)

(47)

30,920

33,149

(2,229)

30,920

70,193

132,179

133,597

(1,418)

132,179

79,220

The notes on subsequent pages are an integral part of these consolidated and company financial statements.

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

Atalaya Mining Plc.

104

Consolidated and Company Financial Statements

Consolidated and Company Statements of Financial Position

As at 31 December 2022

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

(Euro 000’s)

Assets

Non-current assets

Property, plant and equipment

Intangible assets

Investment in subsidiaries

Trade and other receivables

Non-current financial asset

Deferred tax asset

Current assets

Inventories

Trade and other receivables

Tax refundable

Other financial assets

Cash and cash equivalents

Total assets

Equity and liabilities

Equity attributable to owners of the parent

Share capital

Share premium

Other reserves

Accumulated profit

Non-controlling interests

Total equity

Liabilities

Non-current liabilities

Trade and other payables

Provisions

Lease liability

Borrowings

Current liabilities

Trade and other payables

Lease liability

Current tax liabilities

Current provisions

Borrowings

Total liabilities

Total equity and liabilities

The Group

The Company

The Group

The Company

Note

2022

2021

354,908

53,830

16,362

1,101

7,293

74,911

259,904

333,096

57,368

5,330

1,101

5,564

64,171

245,744

433,494

334,815

402,459

309,915

38,841

64,155

100

126,448

229,577

663,071

13,596

319,411

69,805

70,483

473,295

(6,998)

466,297

2,015

24,083

4,378

20,768

51,244

90,022

536

1,425

952

52,595

145,530

196,774

663,071

48,831

39,472

88,336

423,151

13,596

319,411

9,419

75,216

417,642

5,402

107

5,509

423,151

24,781

50,128

483

107,517

182,948

585,407

13,447

315,916

52,690

58,754

440,807

(4,909)

435,898

3,450

26,578

4,913

34,050

68,991

66,191

597

336

13,394

80,518

149,509

585,407

2,415

37,270

39,724

349,639

13,447

315,916

8,146

10,116

347,625

2,014

349,639

The notes on subsequent pages are an integral part of these consolidated and company financial statements.

The consolidated and company financial statements were authorised for issue by the Board of Directors on 21 March 2023 and were signed
on its behalf.

Roger Davey

Chair

Alberto Lavanderia

Chief Execute Officer

Atalaya Mining Plc.

Consolidated and Company Financial Statements

105

Consolidated Statement of Changes in Equity

For the year ended 31 December 2022

(Euro 000’s)

1 Jan 2022

Adjustment prior year

Opening balance adjusted

Profit/(loss) for the period

e
t
o
N

a
t
i
p
a
c

e
r
a
h
S

)
2
(

m
u
m
e
r
p

e
r
a
h
S

)
1
(

s
e
v
r
e
s
e
r

r
e
h
t
O

m
u
c
c
A

s
t
i
f
o
r
P

a
t
o
T

C
N

y
t
i
u
q
e

a
t
o
T

13,447

315,916

52,690

58,754

440,807

(4,909)

435,898

(53)

13,447

315,916

52,690

58,701

440,754

(4,909)

435,845

Change in fair value of financial assets through OCI

Total comprehensive (loss)/ income

Issuance of share capital

Recognition of depletion factor

Recognition of share-based payments

Recognition of non-distributable reserve

Recognition of distributable reserve

Other changes in equity

Dividends paid

31 Dec 2022

149

3,495

(6)

33,155

(2,229)

30,926

(6)

33,155

33,149

(2,229)

30,920

12,800

(12,800)

3,644

1,279

316

(316)

2,726

(2,726)

3,644

1,279

(432)

140

(292)

(5,099)

13,596

319,411

69,805

70,483

473,295

(6,998)

466,297

e
t
o
N

a
t
i
p
a
c

e
r
a
h
S

)
2
(

m
u
m
e
r
p

e
r
a
h
S

)
1
(

s
e
v
r
e
s
e
r

r
e
h
t
O

m
u
c
c
A

s
t
i
f
o
r
P

a
t
o
T

C
N

y
t
i
u
q
e

a
t
o
T

13,439

315,714

40,049

(15,512)

353,690

(3,491)

350,199

133,644

(1,418)

132,226

(47)

133,644

133,597

(1,418)

132,179

202

(47)

6,100

(6,100)

899

2,372

(2,372)

3,317

(3,317)

210

899

(299)

(47,290)

210

899

(299)

(47,290)

13,447

315,916

52,690

58,754

440,807

(4,909)

435,898

(Euro 000’s)

1 Jan 2021

Profit/(loss) for the period

Change in fair value of financial assets through OCI

Total comprehensive (loss)/income

Issuance of share capital

Recognition of depletion factor

Recognition of share-based payments

Recognition of non-distributable reserve 23

Recognition of distributable reserve

Other changes in equity

Dividends paid

31 Dec 2021

(1) Refer to Note 23

(2) The share premium reserve is not available for distribution.

The notes on subsequent pages are an integral part of these consolidated and company financial statements.

Atalaya Mining Plc.

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

106

Consolidated and Company Financial Statements

Company Statement of Changes in Equity

For the year ended 31 December 2022

(Euro 000’s)

1 Jan 2021

Profit for the year

Change in fair value of financial assets through OCI

Total comprehensive income

Issuance of share capital

Recognition of share-based payments

Dividends paid

31 Dec 2021/1 Jan 2022

Profit for the period

Change in fair value of financial assets through OCI

Total comprehensive income

Transactions with owners

Issuance of share capital

Recognition of share-based payments

Dividends paid

31 Dec 2022

(1) Refer to Note 23

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

(2) The share premium reserve is not available for distribution.

Note

Share
capital

Share
premium(1)

Other
reserves

Accum.
Profits

Total

13,439

315,714

7,294

(21,861)

314,586

202

(47)

899

79,267

(47)

79,267

79,220

210

899

(47,290)

13,447

315,916

8,146

10,116

347,625

149

3,495

(6)

1,279

70,199

(6)

70,199

70,193

3,644

1,279

(5,099)

13,596

319,411

9,419

75,216

417,642

Companies, which do not distribute 70% of their profits after tax, as defined by the Special Contribution for the Defence of the Republic Law,
within two years after the end of the relevant tax year, will be deemed to have distributed this amount as dividend on the 31 of December of
the second year. The amount of the deemed dividend distribution is reduced by any actual dividend already distributed by 31 of December of
the second year for the year the profits relate.

The Company pays special defence contribution on behalf of the shareholders over the amount of the deemed dividend distribution at a rate
of 17% (applicable since 2014) when the entitled shareholders are natural persons tax residents of Cyprus and have their domicile in Cyprus. In
addition, from 2019 (deemed dividend distribution of year 2017 profits), the Company pays on behalf of the shareholders General Healthcare
System (GHS) contribution at a rate of 2.65% (31 December 2021: 2.65%), when the entitled shareholders are natural persons tax residents of
Cyprus, regardless of their domicile.

The notes on subsequent pages are an integral part of these consolidated and company financial statements.

Atalaya Mining Plc.

Consolidated and Company Financial Statements

107

Consolidated Statement of Cash Flows

For the year ended 31 December 2022

(Euro 000’s)

Note

2022

2021

Cash flows from operating activities

Profit before tax

Adjustments for:

Depreciation of property, plant and equipment

Amortisation of intangible assets

Recognition of sharebased payments

Interest income

Interest expense

Unwinding of discounting

Finance provisions

Other provisions

Legal provisions

Net foreign exchange differences

Unrealised foreign exchange loss on financing activities

Cash inflows from operating activities before working capital changes

Changes in working capital:

Inventories

Trade and other receivables

Trade and other payables

Provisions

Cash flows from operations

Interest expense on lease liabilities

Interest paid

Tax paid

Net cash from operating activities

Cash flows from investing activities

Purchases of property, plant and equipment

Purchases of intangible assets

Payment of deferred consideration

Interest received

Net cash used in investing activities

Cash flows from financing activities

Lease payment

Net proceeds from borrowings

Proceeds from issue of share capital

Dividends paid

Net cash from financing activities

Net increase in cash and cash equivalents

Net foreign exchange difference

Cash and cash equivalents:

At beginning of the year

At end of the year

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

32,320

159,827

29,637

4,482

1,279

(244)

1,025

(43)

(11,546)

56,934

(14,060)

(24,471)

24,662

(91)

42,975

(20)

(1,025)

(3,427)

38,503

(52,650)

(944)

(53,529)

(617)

24,484

3,643

(5,099)

22,411

7,385

11,546

107,517

126,448

27,680

4,596

899

(57)

846

1,063

11,737

417

(61)

(6,692)

200,255

(1,205)

(8,807)

(14,400)

(343)

175,500

(11)

(846)

(25,802)

148,841

(32,440)

(2,148)

(53,000)

(87,531)

(463)

49,446

158

(47,290)

1,851

63,161

6,589

37,767

107,517

The notes on subsequent pages are an integral part of these consolidated and company financial statements.

Atalaya Mining Plc.

108

Consolidated and Company Financial Statements

Company Statement of Cash Flows

For the year ended 31 December 2022

(Euro 000’s)

Note

2022

2021

Cash flows from operating activities

Profit before tax

Adjustments for:

Interest income

Interest income from interest-bearing intercompany loans

Net foreign exchange difference

Unrealised foreign exchange loss on financing activities

Cash inflows from operating activities before working capital changes

Changes in working capital:

Trade and other receivables

Trade and other payables

Cash flows from operations

Tax paid

Interest paid

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

Net cash from/(used in) operating activities

Cash flows from investing activities

Investment in subsidiaries

Interest received

Interest income from interest-bearing intercompany loans

Net cash (used in)/from investing activities

Cash flows from financing activities

Proceeds from issue of share capital

Dividends paid

Net cash used in financing activities

Net (decrease)/increase in cash and cash equivalents

Net foreign exchange difference

Cash and cash equivalents:

At beginning of the year

At end of the year

70,816

80,129

(36)

(12,900)

(3,439)

(63)

54,378

(61,273)

3,950

(2,945)

(311)

(1,025)

(3,256)

(9,461)

12,900

3,475

3,643

(5,099)

(1,456)

(1,237)

3,439

37,270

39,472

(15,252)

64,877

81,713

(20,103)

126,487

(1,614)

(846)

124,873

(57,824)

15,252

(42,572)

210

(47,290)

(47,080)

35,221

2,049

37,270

The notes on subsequent pages are an integral part of these consolidated and company financial statements.

Atalaya Mining Plc.

110

Consolidated and Company Financial Statements

Notes to the Consolidated and Company Financial Statements

7.3

Notes to the Consolidated
and Company Financial
Statements

Year ended 31 December 2022

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

Atalaya Mining Plc.

Notes to the Consolidated and Company Financial Statements

Consolidated and Company Financial Statements

111

1. Incorporation and
summary of business

Atalaya Mining Plc (the “Company”) was incorporated
in Cyprus on 17 September 2004 as a private company
with limited liability under the Companies Law, Cap.
113 and was converted to a public limited liability
company on 26 January 2005. Its registered office is at
1 Lampousa Street, Nicosia, Cyprus.

The Company was listed on AIM of the London Stock
Exchange in May 2005 under the symbol ATYM.
The Company continued to be listed on AIM as at 31
December 2022.

On 20 February 2023, Atalaya announced that applied
a voluntary delisting of its ordinary shares from the
Toronto Stock Exchange (the “TSX”) with effective date
of the closing of trading on 7 March 2023. Ordinary
shares in the Company continue to trade on the AIM
market of the London Stock Exchange under the
symbol “ATYM”. Delisting from TSX took effect at the
close of trading on 20 March 2023.

Additional information about Atalaya Mining Plc is
available at www.atalayamining.com as per require-
ment of AIM rule 26.

Change of name and share consolidation

Following the Company’s Extraordinary General
Meeting (“EGM”) on 13 October 2015, the change of
name from EMED Mining Public Limited to Atalaya
Mining Plc became effective on 21 October 2015. On
the same day, the consolidation of ordinary shares
came into effect, whereby all shareholders received
one new ordinary share of nominal value Stg £0.075 for
every 30 existing ordinary shares of nominal value Stg
£0.0025.

Principal activities

Atalaya is a European mining and development
company. The strategy is to evaluate and prioritise
metal production opportunities in several jurisdictions
throughout the well-known belts of base and precious
metal mineralisation in Spain, elsewhere in European
and Latin America.

The Group currently owns four mining projects:
Proyecto Riotinto, Proyecto Touro, Proyecto Masa
Valverde and Proyecto Ossa Morena. In addition, the
Company has an earn-in agreement to acquire three
investigation permits at Proyecto Riotinto Este.

Proyecto Riotinto

Proyecto Touro

The Group has an initial 10% stake in Cobre San Rafael,
S.L., the owner of Proyecto Touro, as part of an earn-in
agreement which will enable the Group to acquire up
to 80% of the copper project. Proyecto Touro is located
in Galicia, north-west Spain. Proyecto Touro is currently
in the permitting process.

In November 2019, Atalaya executed the option to
acquire 12.5% of Explotaciones Gallegas del Cobre, S.L.
the exploration property around Touro, with known
additional reserves, which will provide high potential
to the Proyecto Touro.

Proyecto Masa Valverde

On 21 October 2020, the Company announced that
it entered into a definitive purchase agreement to
acquire 100% of the shares of Cambridge Mineria
España, S.L. (since renamed Atalaya Masa Valverde,
S.L.U.), a Spanish company which fully owns the
Masa Valverde polymetallic project located in Huelva
(Spain). Under the terms of the agreement Atalaya
will make an aggregate €1.4 million cash payment in
two instalments of approximately the same amount.
The first payment is to be executed once the project
is permitted and second and final payment when first
production is achieved from the concession. Proyecto
Masa Valverde is currently in the permitting process.

Proyecto Ossa Morena

In December 2021, Atalaya announced the acquisition
of a 51% interest in Rio Narcea Nickel, S.L., which owns
9 investigation permits. The acquisition also provided
a 100% interest in three investigation permits that are
also located along the Ossa- Morena Metallogenic Belt.
In Q3 2022, Atalaya increased its ownership interest in
POM to 99.9%, up from 51%, following completion of
a capital increase that will fund exploration activities.
During 2022 Atalaya rejected 8 investigation permits.

Atalaya will pay a total of €2.5 million in cash in three
instalments and grant a 1% net smelter return (“NSR”)
royalty over all acquired permits. The first payment
of €0.5 million will be made following execution
of the purchase agreement. The second and third
instalments of €1 million each will be made once the

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

Atalaya Mining Plc.

112

Consolidated and Company Financial Statements

Notes to the Consolidated and Company Financial Statements

environmental impact statement (“EIS”) and the final
mining permits for any project within any of the inves-
tigation permits acquired under the Transaction are
secured.

the Group’s accounting policies. The areas involving
a higher degree of judgement or complexity, or areas
where assumptions and estimates are significant to
the financial statements are disclosed in Note 3.3.

Proyecto Riotinto Este

(b) Going concern

In December 2020, Atalaya entered into a Memo-
randum of Understanding with a local private Spanish
company to acquire a 100% beneficial interest in three
investigation permits (known as Peñas Blancas, Cerro
Negro and Herreros investigation permits), which
cover approximately 12,368 hectares and are located
immediately east of Proyecto Riotinto.

2. Summary of significant
accounting policies

The principal accounting policies applied in the prepa-
ration of these consolidated and company financial
statements are set out below. These policies have been
consistently applied to all the years presented, unless
otherwise stated.

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

2.1 Basis of preparation

(a) Overview

The financial statements of Atalaya Mining Plc have
been prepared in accordance with International Finan-
cial Reporting Standards (“IFRS”). IFRS comprise the
standards issued by the International Accounting Stand-
ards Board (“IASB”).

The financial statements are presented in € and all
values are rounded to the nearest thousand (€’000),
except where otherwise indicated.

Additionally, the financial statements have also been
prepared in accordance with the IFRS as adopted
by the European Union and the requirements of the
Cyprus Companies Law, Cap.113. For the year ending
31 December 2022, the standards applicable for IFRS’s
as adopted by the EU are aligned with the IFRS’s as
issued by the IASB.

The consolidated financial statements have been
prepared on a historical cost basis except for the
revaluation of certain financial instruments that are
measured at fair value at the end of each reporting
period, as explained below and in note 3.

The preparation of financial statements in conformity
with IFRS requires the use of certain critical
accounting estimates. It also requires management
to exercise its judgment in the process of applying

The Directors have considered and debated different
possible scenarios on the Company’s operations,
financial position and forecast for a period of at least
12 months since the approval of these financial state-
ments. Possible scenarios range from (i) disruption in
Proyecto Riotinto; (ii) market volatility in commodity and
electricity prices; and (iii) availability of existing credit
facilities.

The Directors, after reviewing these scenarios, the
current cash resources, forecasts and budgets, timing
of cash flows, borrowing facilities, sensitivity analyses
and considering the associated uncertainties to the
Group’s operations have a reasonable expectation
that the Company has adequate resources to continue
operating in the foreseeable future.

Accordingly, these financial statements have been
prepared based on accounting principles applicable
to a going concern which assumes that the Group and
the Company will realise its assets and discharge its
liabilities in the normal course of business. Manage-
ment has carried out an assessment of the going
concern assumption and has concluded that the
Group and the Company will generate sufficient
cash and cash equivalents to continue operating for
the next twelve months since the approval of these
consolidated financial statements.

Management continues to monitor the impact of
geopolitical developments. Currently no significant
impact is expected in the operations of the Group.

2.2 Changes in accounting policy and
disclosures

The Group has adopted all the new and revised IFRSs
and International Accounting Standards (IASs) which
are relevant to its operations and are effective for
accounting periods commencing on 1 January 2022.

Several other amendments and interpretations apply
for the first time in 2022, but do not have a significant
impact on the financial statements of the Group. The
Group has not early adopted any standards, interpre-
tations or amendments that have been issued but are
not yet effective.

Atalaya Mining Plc.

Notes to the Consolidated and Company Financial Statements

Consolidated and Company Financial Statements

113

■ IFRS 3 Business Combinations; IAS 16 Property,

Plant and Equipment; IAS 37 Provisions, Contingent
Liabilities and Contingent Assets as well as Annual
Improvements 2018-2020 (Amendments)

The amendments are effective for annual periods
beginning on or after 1 January 2022 with earlier
application permitted. The IASB has issued narrow-
scope amendments to the IFRS Standards as
follows:

IFRS 3 Business Combinations (Amendments)
update a reference in IFRS 3 to the previous version
of the IASB’s Conceptual Framework for Financial
Reporting to the current version issued in 2018
without significantly changing the accounting
requirements for business combinations.

IAS 16 Property, Plant and Equipment (Amend-
ments) prohibit a company from deducting from
the cost of property, plant and equipment any
proceeds from the sale of items produced while
bringing the asset to the location and condition
necessary for it be capable of operating in the
manner intended by management. Instead, a
company recognizes such sales proceeds and
related cost in profit or loss.

IAS 37 Provisions, Contingent Liabilities and
Contingent Assets (Amendments) specify which
costs a company includes in determining the cost
of fulfilling a contract for the purpose of assessing
whether a contract is onerous. The amendments
clarify, the costs that relate directly to a contract to
provide goods or services include both incremental
costs and an allocation of costs directly related to
the contract activities.

» Annual Improvements 2018-2020 make minor
amendments to IFRS 1 First-time Adoption of
International Financial Reporting Standards, IFRS
9 Financial Instruments, IAS 41 Agriculture and the
Illustrative Examples accompanying IFRS 16 Leases.

These amendments had no impact on the consoli-
dated financial statements of the Group.

■ IFRS 16 Leases-Covid 19 Related Rent Concessions

beyond 30 June 2021 (Amendment)

The Amendment applies to annual reporting
periods beginning on or after 1 April 2021, with
earlier application permitted, including in finan-
cial statements not yet authorized for issue at the
date the amendment is issued. In March 2021, the
Board amended the conditions of the practical
expedient in IFRS 16 that provides relief to lessees
from applying the IFRS 16 guidance on lease modi-
fications to rent concessions arising as a direct

consequence of the Covid-19 pandemic. Following
the amendment, the practical expedient now
applies to rent concessions for which any reduction
in lease payments affects only payments originally
due on or before 30 June 2022, provided the other
conditions for applying the practical expedient are
met.

The Group has not received Covid-19-related rent
concessions.

2.2.1 Standards issued but not yet
effective

■ IFRS 17: Insurance Contracts

The standard is effective for annual periods begin-
ning on or after 1 January 2023 with earlier appli-
cation permitted, provided the entity also applies
IFRS 9 Financial Instruments on or before the date
it first applies IFRS 17. This is a comprehensive
new accounting standard for insurance contracts,
covering recognition and measurement, presenta-
tion and disclosure. IFRS 17 applies to all types of
insurance contracts issued, as well as to certain
guarantees and financial instruments with discre-
tional participation contracts. The Company does
not issue contracts in scope of IFRS 17; therefore
its application does not have an impact on the
Company’s financial performance, financial position
or cash flows.

IFRS 17, with the objective to provide an accounting
model for insurance contracts that is more useful
and consistent for insurers, establishes principles
for the recognition, measurement, presentation
and disclosure of all types of insurance contracts, as
well as of certain guarantees and financial instru-
ments with discretionary participation features. The
accounting model is supplemented by a specific
adaptation for contracts with direct participation
features (the variable fee approach) and by a simpli-
fied approach (the premium allocation approach)
mainly for short-duration contracts.

The main features of the new accounting model
include the measurement of the present value of
future cash flows, incorporating an explicit risk
adjustment, remeasured every reporting period
(the fulfilment cash flows). Also, the model includes
a Contractual Service Margin (CSM) that is equal
and opposite to any day one gain in the fulfilment
cash flows of a group of contracts, representing
the unearned profit of the insurance contracts
to be recognised in profit or loss based on insur-
ance contract services provided over the coverage
period. Certain changes in the expected present

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

Atalaya Mining Plc.

114

Consolidated and Company Financial Statements

Notes to the Consolidated and Company Financial Statements

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

value of future cash flows are adjusted against the
CSM and thereby recognised in profit or loss over
the remaining coverage period. Amounts that are
paid to a policyholder in all circumstances, regard-
less of whether an insured event occurs (non-dis-
tinct investment components) are not presented in
the income statement but are recognised directly
on the statement of financial position.

Furthermore, the presentation of insurance revenue
and insurance service expenses in the statement
of comprehensive income will be based on the
concept of services provided during the period.
Insurance services results (earned revenue less
incurred claims) are presented separately from the
insurance finance income or expense. In the state-
ment of financial position, the carrying amounts
of portfolios of insurance contracts issued that are
assets and those that are liabilities, with the same
requirement applying to portfolios of reinsurance
contracts held, are presented separately. Finally,
IFRS 17 requires extensive disclosures to provide
information on the recognised amounts from
insurance contracts and the nature and extent of
risks arising from these contracts. 2. Summary of
significant accounting policies (cont.)

Regarding the transition, the Board decided on
a retrospective approach for estimating the CSM
on the transition date. However, if full retrospec-
tive application, as defined by IAS 8, for a group of
insurance contracts, is impracticable, an entity is
required to choose either the modified retrospec-
tive approach or fair value approach. Both provide
transitional reliefs.

Finally, in December 2021, the IASB issued amend-
ments to IFRS 17 to add a transition option for
a “classification overlay” to address possible
accounting mismatches between financial assets
and insurance contract liabilities in the comparative
information presented on initial application of IFRS
17. An entity applying the classification overlay to
a financial asset shall present comparative infor-
mation as if the classification and measurement
requirements of IFRS 9 had been applied to that
financial asset. Management is currently assessing
the effect of the standard and its amendments but
expects no significant impact.

■ IAS 1 Presentation of Financial Statements and IFRS
Practice Statement 2: Disclosure of Accounting
policies (Amendments)

The Amendments are effective for annual periods
beginning on or after January 1, 2023 with earlier
application permitted. The amendments provide
guidance on the application of materiality

judgements to accounting policy disclosures. In
particular, the amendments to IAS 1 replace the
requirement to disclose ‘significant’ accounting
policies with a requirement to disclose ‘material’
accounting policies. Also, guidance and illustrative
examples are added in the Practice Statement to
assist in the application of the materiality concept
when making judgements about accounting policy
disclosures.

The Group is currently assessing the impact the
amendments will have on current practice and
whether existing loan agreements may require
renegotiation. The amendment is not expected to
have a material impact on the Group.

■ IAS 8 Accounting policies, Changes in Accounting
Estimates and Errors: Definition of Accounting Esti-
mates (Amendments)

The amendments become effective for annual
reporting periods beginning on or after January 1,
2023 with earlier application permitted and apply
to changes in accounting policies and changes in
accounting estimates that occur on or after the
start of that period. The amendments introduce a
new definition of accounting estimates, defined
as monetary amounts in financial statements that
are subject to measurement uncertainty, if they do
not result from a correction of prior period error.
Also, the amendments clarify what changes in
accounting estimates are and how these differ from
changes in accounting policies and corrections of
errors. The amendments are not expected to have a
material impact on the Group.

■ IAS 12 Income taxes: Deferred Tax related to Assets
and Liabilities arising from a Single Transaction
(Amendments)

The amendments are effective for annual periods
beginning on or after January 1, 2023 with earlier
application permitted. The amendments narrow
the scope of and provide further clarity on the initial
recognition exception under IAS 12 and specify
how companies should account for deferred tax
related to assets and liabilities arising from a single
transaction, such as leases and decommissioning
obligations. The amendments clarify that where
payments that settle a liability are deductible for
tax purposes, it is a matter of judgement, having
considered the applicable tax law, whether such
deductions are attributable for tax purposes to
the liability or to the related asset component.
Under the amendments, the initial recognition
exception does not apply to transactions that, on
initial recognition, give rise to equal taxable and

Atalaya Mining Plc.

Notes to the Consolidated and Company Financial Statements

Consolidated and Company Financial Statements

115

deductible temporary differences. It only applies if
the recognition of a lease asset and lease liability (or
decommissioning liability and decommissioning
asset component) give rise to taxable and deduct-
ible temporary differences that are not equal. The
amendments are not expected to have a material
impact on the Group.

■ IAS 1 Presentation of Financial Statements: Clas-
sification of Liabilities as Current or Non-current
(Amendments)

The amendments are effective for annual reporting
periods beginning on or after January 1, 2024, with
earlier application permitted, and will need to be
applied retrospectively in accordance with IAS 8.
The objective of the amendments is to clarify the
principles in IAS 1 for the classification of liabilities
as either current or non-current. The amendments
clarify the meaning of a right to defer settlement,
the requirement for this right to exist at the end of
the reporting period, that management intent does
not affect current or non-current classification, that
options by the counterparty that could result in
settlement by the transfer of the entity’s own equity
instruments do not affect current or non-current
classification. Also, the amendments specify that
only covenants with which an entity must comply
on or before the reporting date will affect a liabil-
ity’s classification. Additional disclosures are also
required for non-current liabilities arising from
loan arrangements that are subject to covenants
to be complied with within twelve months after
the reporting period. The amendments have not
yet been endorsed by the EU. Management has
assessed. The amendment is not expected to have
a material impact on the Group.

the amendment retrospectively in accordance with
IAS 8 to sale and leaseback transactions entered
into after the date of initial application, being
the beginning of the annual reporting period in
which an entity first applied IFRS 16. The amend-
ments have not yet been endorsed by the EU.
Management has assessed. The amendment is not
expected to have a material impact on the Group.

Amendment in IFRS 10 Consolidated Financial
Statements and IAS 28 Investments in Associates
and Joint Ventures: Sale or Contribution of Assets
between an Investor and its Associate or Joint
Venture

The amendments address an acknowledged
inconsistency between the requirements in IFRS
10 and those in IAS 28, in dealing with the sale or
contribution of assets between an investor and its
associate or joint venture. The main consequence
of the amendments is that a full gain or loss is
recognized when a transaction involves a busi-
ness (whether it is housed in a subsidiary or not). A
partial gain or loss is recognized when a transaction
involves assets that do not constitute a business,
even if these assets are housed in a subsidiary. In
December 2015 the IASB postponed the effec-
tive date of this amendment indefinitely pending
the outcome of its research project on the equity
method of accounting. The amendments have not
yet been endorsed by the EU. The amendment
is not expected to have a material impact on the
Group.

2.3 Consolidation

(a) Basis of consolidation

■ IFRS 16 Leases: Lease Liability in a Sale and Lease-

back (amendments)

The consolidated financial statements comprise the
financial statements of Atalaya Mining Plc and its
subsidiaries.

The amendments are effective for annual reporting
periods beginning on or after January 1, 2024, with
earlier application permitted. The amendments
are intended to improve the requirements that a
seller-lessee uses in measuring the lease liability
arising in a sale and leaseback transaction in IFRS
16, while it does not change the accounting for
leases unrelated to sale and leaseback transactions.
In particular, the seller-lessee determines ‘lease
payments’ or ‘revised lease payments’ in such a
way that the seller-lessee would not recognise any
amount of the gain or loss that relates to the right
of use it retains. Applying these requirements does
not prevent the seller-lessee from recognising, in
profit or loss, any gain or loss relating to the partial
or full termination of a lease. A seller-lessee applies

(b) Subsidiaries

Subsidiaries are all entities (including special purpose
entities) over which the Group and the Company has
control. Control exists when the Group is exposed, or
has rights, to variable returns for its involvement with
the investee and has the ability to affect those returns
through its power over the investee. The existence and
effect of potential voting rights that are currently exer-
cisable or convertible are considered when assessing
whether the Group controls another entity. The Group
also assesses existence of control where it does not
have more than 50% of the voting power but is able to
govern the financial and operating policies by virtue of
de-facto control.

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

Atalaya Mining Plc.

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

116

Consolidated and Company Financial Statements

Notes to the Consolidated and Company Financial Statements

De-facto control may arise in circumstances where the
size of the Group’s voting rights relative to the size and
dispersion of holdings of other shareholders give the
Group the power to govern the financial and operating
policies, etc.

The Group re-assesses whether it controls an investee
if facts and circumstances indicate that there are
changes to one or more of the three elements of
control. Consolidation of a subsidiary begins when
the Group obtains control over the subsidiary and
ceases when the Group loses control of the subsidiary.
Assets, liabilities, income and expenses of a subsidiary
acquired or disposed of during the year are included
in the consolidated financial statements from the
date the Group gains control until the date the Group
ceases to control the subsidiary.

Profit or loss and each component of OCI are attrib-
uted to the equity holders of the parent of the Group
and to the non-controlling interests, even if this
results in the non-controlling interests having a deficit
balance. When necessary, adjustments are made to
the financial statements of subsidiaries to bring their
accounting policies in line with the Group’s accounting

policies. All intra-group assets and liabilities, equity,
income, expenses and cash flows relating to transac-
tions between members of the Group are eliminated
in full on consolidation.

A change in the ownership interest of a subsidiary,
without a loss of control, is accounted for as an equity
transaction.

Subsidiaries are fully consolidated from the date on
which control is transferred to the Group. If the Group
loses control over a subsidiary, it derecognises the
related assets (including goodwill), liabilities, non-con-
trolling interest and other components of equity, while
any resultant gain or loss is recognised in profit or loss.
Any investment retained is recognised at fair value’.

The main operating subsidiary of Atalaya Mining Plc is
the 100% owned Atalaya Riotinto Minera, S.L.U. which
operates “Proyecto Riotinto”, in the historical site of
Huelva, Spain.

The name and shareholding of the entities included in
the Group in these financial statements are:

Entity name

Atalaya Mining, Plc

EMED Marketing Ltd.

EMED Mining Spain, S.L. (4)

Atalaya Riotinto Minera, S.L.U.

Recursos Cuenca Minera, S.L. (3)

Atalaya Minasderiotinto Project (UK), Ltd.

Eastern Mediterranean Exploration & Development, S.L.U.

Atalaya Touro (UK), Ltd.

Fundación Atalaya Riotinto Minera

Cobre San Rafael, S.L. (1)

Atalaya Servicios Mineros, S.L.U.

Atalaya Masa Valverde, S.L.U.

Atalaya Financing Ltd.

Atalaya Ossa Morena, S.L.

Notes:

Business

Holding

Trade

Dormant

Operating

Dormant

Holding

Dormant

Holding

Trust

Development

Holding

Development

Financing

%(2)

n/a

100%

50%

100%

10%

100%

Development

99.90%

Country

Cyprus

Spain

United Kingdom

Spain

United Kingdom

Spain

Cyprus

Spain

(1) Cobre San Rafael, S.L. is the entity which holds the mining rights of the Proyecto Touro. The Group has control in the management of
Cobre San Rafael, S.L., including one of the two Directors, management of the financial books and the capacity to appoint the key personnel.
Refer to Note 29 for details on the acquisition of Cobre San Rafael, S.L.

(2) The effective proportion of shares held as at 31 December 2022 and 2021 remained unchanged.

(3) Recursos Cuenca Minera is a joint venture with Atalaya Riotinto Minera, S.L.U., see note 16.

(4) EMED Mining Spain, S.L. was disposed on 4 January 2022. See note 29.

Atalaya Mining Plc.

Notes to the Consolidated and Company Financial Statements

Consolidated and Company Financial Statements

117

The Group applies the acquisition method to account
for business combinations. The consideration trans-
ferred for the acquisition of a subsidiary is the fair value
of the transferred assets, liabilities incurred by the
former owners of the acquiree and the equity interests
issued by the Group. The consideration transferred
includes the fair value of any asset or liability resulting
from a contingent consideration arrangement.
Identifiable assets acquired, liabilities and contingent
liabilities assumed in a business combination are
measured initially at fair value at the acquisition date.
The Group recognised any non-controlling interest in
the acquiree on an acquisition-by-acquisition basis,
either at fair value or at the non-controlling interest’s
proportionated share of the recognised amounts of
acquiree’s identifiable net assets.

If the business combination is achieved in stages, the
acquisition date carrying value of the acquirer’s previ-
ously held equity interest in the acquire is re-measured
to fair value at the acquisition date; any gains or losses
arising from such re-measurement are recognised in
profit or loss.

Any contingent consideration to be transferred by
the Group is recognised at fair value at the acquisi-
tion date. Subsequent changes to the fair value of the
contingent consideration that is deemed to be an
asset or liability is recognised in accordance with IFRS
9 in profit or loss. Contingent consideration that is clas-
sified as equity is not re-measured, and its subsequent
settlement is accounted for within equity.

Inter-company transactions, balances, income and
expenses on transactions between Group companies
are eliminated. Gains and losses resulting from inter-
company transactions that are recognised in assets
are also eliminated. Accounting policies of subsidi-
aries have been changed where necessary to ensure
consistency with the policies adopted by the Group.

(d) Changes in ownership interests in subsidiaries
without change of control

Transactions with non-controlling interests that do
not result in loss of control are accounted for as equity
transactions – that is, as transactions with the owners
in their capacity as owners. The difference between
fair value of any consideration paid and the relevant
share acquired of the carrying value of net assets of
the subsidiary is recorded in equity. Gains or losses
on disposals to non-controlling interests are also
recorded in equity.

(e) Disposal of subsidiaries

When the Group ceases to have control any retained
interest in the entity is re-measured to its fair value
at the date when control is lost, with the change in
carrying amount recognised in profit or loss. The fair
value is the initial carrying amount for the purposes
of subsequently accounting for the retained interest
as an associate, joint venture or financial asset. In
addition, any amounts previously recognised in other
comprehensive income in respect of that entity are
accounted for as if the Group had directly disposed
of the related assets or liabilities. This may mean that
amounts previously recognised in other comprehen-
sive income are reclassified to profit or loss.

(f) Associates and joint ventures

An associate is an entity over which the Group has
significant influence. Significant influence is the power
to participate in the financial and operating policy
decisions of the investee (generally accompanying a
shareholding of between 20% and 50% of the voting
rights) but is not control or joint control over those
policies.

A joint venture is a type of joint arrangement whereby
the parties that have joint control of the arrangement
have rights to the net assets of the joint venture. Joint
control is the contractually agreed sharing of control
of an arrangement, which exists only when decisions
about the relevant activities require the unanimous
consent of the parties sharing control.

Investments in associates or joint ventures are
accounted for using the equity method of accounting.
Under the equity method, the investment is initially
recognised at cost, and the carrying amount is
increased or decreased to recognise the investor’s
share of the profit or loss of the investee after the
date of acquisition. The Group’s investment in associ-
ates or joint ventures includes goodwill identified on
acquisition.

If the ownership interest in an associate or joint
venture is reduced but significant influence is retained,
only a proportionate share of the amounts previously
recognised in other comprehensive income is reclassi-
fied to profit or loss where appropriate.

The Group’s share of post-acquisition profit or loss is
recognised in the income statement, and its share
of post-acquisition movements in other comprehen-
sive income is recognised in other comprehensive
income, with a corresponding adjustment to the
carrying amount of the investment. When the Group
share of losses in an associate or a joint venture
equals or exceeds its interest in the associate or joint
venture, including any other unsecured receivables,

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

Atalaya Mining Plc.

118

Consolidated and Company Financial Statements

Notes to the Consolidated and Company Financial Statements

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

the Group does not recognise further losses, unless
it has incurred legal or constructive obligations or
made payments on behalf of the associate or the joint
venture.

exchange rates at the dates of the initial transaction.
Non-monetary items measured at fair value in a
foreign currency are translated using the exchange
rates at the date when the fair value was determined.

The Group determines at each reporting date whether
there is any objective evidence that the investment
in the associate or the joint venture is impaired. If
this is the case, the Group calculates the amount of
impairment as the difference between the recoverable
amount of the associate or the joint venture and its
carrying value and recognises the amount adjacent to
‘share of profit/(loss) of associates’ or joint ventures’ in
the income statement.

Profits and losses resulting from upstream and
downstream transactions between the Group and its
associate or joint venture are recognised in the Group’s
consolidated financial statements only to the extent
of unrelated investors’ interests in the associates or
the joint ventures. Unrealised losses are eliminated
unless the transaction provides evidence of an impair-
ment of the asset transferred. Accounting policies of
associates have been changed where necessary to
ensure consistency with the policies adopted by the
Group. Dilution gains and losses arising in investments
in associates or joint ventures are recognised in the
income statement.

(g) Functional currency

Functional and presentation currency items included
in the financial statements of each of the Group’s enti-
ties are measured using the currency of the primary
economic environment in which the entity operates
(‘the functional currency’). The financial statements are
presented in Euro which is the Company’s functional
and presentation currency.

Determination of functional currency may involve
certain judgements to determine the primary
economic environment and the parent entity recon-
siders the functional currency of its entities if there is
a change in events and conditions which determined
the primary economic environment.

Foreign currency transactions are translated into the
functional currency using the spot exchange rates
prevailing at the dates of the transactions or valuation
where items are re-measured. Foreign exchange gains
and losses resulting from the settlement of such trans-
actions are recognised in the income statement.

Monetary assets and liabilities denominated in foreign
currencies are updated at year-end spot exchange
rates.

Non-monetary items that are measured at historical
cost in a foreign currency are translated using the

Gains or losses of monetary and non-monetary items
are recognised in the income statement.

Balance sheet items are translated at period-end
exchange rates. Exchange differences on translation
of the net assets of such entities whose functional
currency are not the Euro are taken to equity and
recorded in a separate currency translation reserve.

2.4 Investments in subsidiary companies
in the Company’s financial statements

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

2.5 Interest in joint arrangements

A joint arrangement is a contractual arrangement
whereby the Group and other parties undertake an
economic activity that is subject to joint control that
is when the strategic, financial and operating policy
decisions relating to the activities the joint arrange-
ment require the unanimous consent of the parties
sharing control.

Where a Group entity undertakes its activities under
joint arrangements directly, the Group’s share of jointly
controlled assets and any liabilities incurred jointly
with other ventures are recognised in the finan-
cial statements of the relevant entity and classified
according to their nature. Liabilities and expenses
incurred directly in respect of interests in jointly
controlled assets are accounted for on an accrual
basis. Income from the sale or use of the Group’s share
of the output of jointly controlled assets, and its share
of joint arrangement expenses, are recognised when it
is probable that the economic benefits associated with
the transactions will flow to/from the Group and their
amount can be measured reliably.

The Group enters joint arrangements that involve
the establishment of a separate entity in which each
acquiree has an interest (jointly controlled entity). The
Group reports its interests in jointly controlled entities
using the equity method of accounting.

Where the Group transacts with its jointly controlled
entities, unrealised profits and losses are eliminated
to the extent of the Group’s interest in the joint
arrangement.

Atalaya Mining Plc.

Notes to the Consolidated and Company Financial Statements

Consolidated and Company Financial Statements

119

2.6 Segment reporting

Operating segments are reported in a manner
consistent with the internal reporting provided to the
chief operating decision-maker. The chief operating
decision-maker, who is responsible for allocating
resources and assessing performance of the operating
segments, has been identified as the CEO who makes
strategic decisions.

The Group has only one distinct business segment,
being that of mining operations, mineral exploration
and development.

2.7 Inventory

Inventory consists of copper concentrates, ore stock-
piles and metal in circuit and spare parts. Inventory is
physically measured or estimated and valued at the
lower of cost or net realisable value. Net realisable
value is the estimated future sales price of the product
the entity expects to realise when the product is
processed and sold, less estimated costs to complete
production and bring the product to sale. Where the
time value of money is material, these future prices
and costs to complete are discounted.

Cost is determined by using the FIFO method and
comprises direct purchase costs and an appropriate
portion of fixed and variable overhead costs, including
depreciation and amortisation, incurred in converting
materials into finished goods, based on the normal
production capacity. The cost of production is allo-
cated to joint products using a ratio of spot prices by
volume at each month end. Separately identifiable
costs of conversion of each metal are specifically
allocated.

Materials and supplies are valued at the lower of cost
or net realisable value. Any provision for obsolescence
is determined by reference to specific items of stock. A
regular review is undertaken to determine the extent
of any provision for obsolescence.

2.8 Assets under construction

All subsequent expenditure on the construction,
installation or completion of infrastructure facilities
including mine plants and other necessary works for
mining, are capitalised in “Assets under Construction”.
Any costs incurred in testing the assets to determine
if they are functioning as intended, are capitalised,
net of any proceeds received from selling any product
produced while testing. Where these proceeds exceed
the cost of testing, any excess is recognised in the
statement of profit or loss and other comprehensive
income. After production starts, all assets included in

“Assets under Construction” are then transferred to
the relevant asset categories.

Once a project has been established as commercially
viable, related development expenditure is capitalised.
A development decision is made based upon consid-
eration of project economics, including future metal
prices, reserves and resources, and estimated oper-
ating and capital costs. Capitalisation of costs incurred
and proceeds received during the development phase
ceases when the property is capable of operating at
levels intended by management.

Capitalisation ceases when the mine is capable of
commercial production, except for development costs
which give rise to a future benefit.

Pre-commissioning sales are offset against the cost of
assets under construction. No depreciation is recog-
nised until the assets are substantially complete and
ready for productive use.

2.9 Property, plant and equipment

Property, plant and equipment are stated at historical
cost less accumulated depreciation and any accumu-
lated impairment losses.

Subsequent costs are included in the assets’ carrying
amount or recognised as a separate asset, as appro-
priate, only when it is probable that future economic
benefits associated with the item will flow to the
Group and the cost of the item can be measured
reliably. The carrying amount of the replaced part is
derecognised. All other repairs and maintenance are
charged to the income statement during the financial
period in which they are incurred.

Property, plant and equipment are depreciated to their
estimated residual value over the estimated useful
life of the specific asset concerned, or the estimated
remaining life of the associated mine (“LOM”), field
or lease. Depreciation commences when the asset is
available for use.

The major categories of property, plant and equipment
are depreciated/amortised on a Unit of Production
(“UOP”) and/or straight-line basis as follows:

Buildings

Mineral rights

Deferred mining costs

Plant and machinery

Motor vehicles

UOP

5 years

Furniture/fixtures/office equipment

5 – 10 years

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

Atalaya Mining Plc.

120

Consolidated and Company Financial Statements

Notes to the Consolidated and Company Financial Statements

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

The assets’ residual values and useful lives are
reviewed, and adjusted if appropriate, at the end of
each reporting period.

An asset’s carrying amount is written down immedi-
ately to its recoverable amount if the asset’s carrying
amount is greater than its estimated recoverable
amount.

Gains and losses on disposals are determined by
comparing the proceeds with the carrying amount
and are recognised within “Other (losses)/gains – net”
in the income statement.

(a) Mineral rights

Mineral reserves and resources which can be reason-
ably valued are recognised in the assessment of fair
values on acquisition. Mineral rights for which values
cannot be reasonably determined are not recognised.
Exploitable mineral rights are amortised using the
UOP basis over the commercially recoverable reserves
and, in certain circumstances, other mineral resources.
Mineral resources are included in amortisation calcu-
lations where there is a high degree of confidence that
they will be extracted in an economic manner.

(b) Deferred mining costs – stripping costs

Mainly comprises of certain capitalised costs related to
pre-production and in-production stripping activities
as outlined below.

Stripping costs incurred in the development phase
of a mine (or pit) before production commences are
capitalised as part of the cost of constructing the mine
(or pit) and subsequently amortised over the life of the
mine (or pit) on a UOP basis.

In-production stripping costs related to accessing
an identifiable component of the ore body to realise
benefits in the form of improved access to ore to be
mined in the future (stripping activity asset), are capi-
talised within deferred mining costs provided all the
following conditions are met:

it is probable that the future economic benefit
associated with the stripping activity will be
realised;

ii.

the component of the ore body for which access
has been improved can be identified and;

iii. the costs relating to the stripping activity asso-
ciated with the improved access can be reliably
measured.

If all of the criteria are not met, the production strip-
ping costs are charged to the consolidated statement
of income as they are incurred.

The stripping activity asset is initially measured at cost,
which is the accumulation of costs directly incurred to
perform the stripping activity that improves access to
the identified component of ore, plus an allocation of
directly attributable overhead costs.

Under the Group’s accounting policy, exploration
expenditure is not capitalised until the management
determines a property will be developed and point is
reached at which there is a high degree of confidence
in the project’s viability and it is considered probable
that future economic benefits will flow to the Group.
A development decision is made based upon consid-
eration of project economics, including future metal
prices, reserves and resources, and estimated oper-
ating and capital costs.

Subsequent recovery of the resulting carrying value
depends on successful development or sale of the
undeveloped project. If a project does not prove viable,
all irrecoverable costs associated with the project net
of any related impairment provisions are written off.

(d) Major maintenance and repairs

Expenditure on major maintenance refits or repairs
comprises the cost of replacement assets or parts of
assets and overhaul costs. Where an asset, or part of
an asset, that was separately depreciated and is now
written off is replaced, and it is probable that future
economic benefits associated with the item will flow
to the Group through an extended life, the expendi-
ture is capitalised.

Where part of the asset was not separately consid-
ered as a component and therefore not depreciated
separately, the replacement value is used to estimate
the carrying amount of the replaced asset(s) which is
immediately written off. All other day-to-day mainte-
nance and repairs costs are expensed as incurred.

(e) Borrowing costs

Borrowing costs directly attributable to the acquisi-
tion, construction or production of an asset that neces-
sarily takes a substantial period of time to get ready
for its intended use or sale (a qualifying asset) are
capitalised as part of the cost of the respective asset.
Where funds are borrowed specifically to finance a
project, the amount capitalised represents the actual
borrowing costs incurred. All other borrowing costs are
recognised in the statement of profit or loss and other
comprehensive income in the period in which they are
incurred.

Atalaya Mining Plc.

Notes to the Consolidated and Company Financial Statements

Consolidated and Company Financial Statements

121

(f) Restoration, rehabilitation and decommissioning

Restoration, rehabilitation and decommissioning
costs arising from the installation of plant and other
site preparation work, discounted using a risk adjusted
discount rate to their net present value, are provided
for and capitalised at the time such an obligation
arises.

The costs are charged to the consolidated statement
of income over the life of the operation through depre-
ciation of the asset and the unwinding of the discount
on the provision. Costs for restoration of subsequent
site disturbance, which are created on an ongoing
basis during production, are provided for at their net
present values and charged to the consolidated state-
ment of income as extraction progresses.

Changes in the estimated timing of the rehabilita-
tion or changes to the estimated future costs are
accounted for prospectively by recognising an adjust-
ment to the rehabilitation liability and a corresponding
adjustment to the asset to which it relates, provided
the reduction in the provision is not greater than the
depreciated capitalised cost of the related asset, in
which case the capitalised cost is reduced to zero and
the remaining adjustment recognised in the consoli-
dated statement of income. In the case of closed sites,
changes to estimated costs are recognised immedi-
ately in the consolidated statement of income.

2.10 Intangible assets

(a) Business combination and goodwill

Goodwill arises on the acquisition of subsidiaries and
represents the excess of the consideration transferred
over the acquired interest in net fair value of the net
identifiable assets, liabilities and contingent liabilities
of the acquiree and the fair value of the non-con-
trolling interest in the acquiree.

The results of businesses acquired during the year are
brought into the consolidated financial statements
from the effective date of acquisition. The identifiable
assets, liabilities and contingent liabilities of a busi-
ness which can be measured reliably are recorded at
their provisional fair values at the date of acquisition.
Acquisition-related costs are expensed as incurred.

Goodwill impairment reviews are undertaken annually
or more frequently if events or changes in circum-
stances indicate a potential impairment. The carrying
value of goodwill is compared to the recoverable
amount, which is the higher of value in use and the
fair value less costs to sell. Any impairment is recog-
nised immediately as an expense and is not subse-
quently reversed.

For the purposes of goodwill impairment testing,
goodwill acquired in a business combination is allo-
cated to groups of CGUs that are expected to benefit
from the synergies of the combination.

An impairment loss in respect of goodwill is not
reversed.

(b) Permits

Permits 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 receives
those permits and commence production, the intan-
gible assets relating to permits will be depreciated on
a UOP basis.

Other intangible assets include computer software.

Intangible assets acquired separately are measured on
initial recognition at cost. The cost of intangible assets
acquired in a business combination is their fair value
at the date of acquisition provided they meet recogni-
tion criteria as per IFRS 3. Following initial recognition,
intangible assets are carried at cost less any accumu-
lated amortisation (calculated on a straight-line basis
over their useful lives) and accumulated impairment
losses, if any.

The useful lives of intangible assets are assessed as
either finite or indefinite.

Intangible assets with finite lives are amortised over
their useful economic lives and assessed for impair-
ment whenever there is an indication that the intan-
gible asset may be impaired. The amortisation period
and the amortisation method for an intangible asset
with a finite useful life are reviewed at least at the end
of each reporting period.

Gains or losses arising from derecognition of an intan-
gible asset are measured as the difference between
the net disposal proceeds and the carrying amount of
the asset and are recognised in the consolidated and
company statements of comprehensive income when
the asset is derecognised.

2.11 Impairment of non-financial assets

Assets that have an indefinite useful life – for example,
goodwill or intangible assets not ready for use – are
not subject to amortisation and are tested annually
for impairment. Assets that are subject to amortisa-
tion are reviewed for impairment whenever events or
changes in circumstances indicate that the carrying
amount may not be recoverable. An impairment loss
is recognised for the amount by which the asset’s

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

Atalaya Mining Plc.

122

Consolidated and Company Financial Statements

Notes to the Consolidated and Company Financial Statements

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

carrying amount exceeds its recoverable amount.
The recoverable amount is the higher of an asset’s
fair value less costs to sell and value in use. For the
purposes of assessing impairment, assets are grouped
at the lowest levels for which there are separately
identifiable cash flows (cash-generating units).
Non-financial assets other than goodwill that suffered
impairment are reviewed for possible reversal of the
impairment at each reporting date.

Financial assets with embedded derivatives are
considered in their entirety when determining
whether their cash flows are solely payment of prin-
cipal and interest.

Subsequent measurement of debt instruments
depends on the Group’s business model for managing
the asset and the cash flow characteristics of the asset.
There are three measurement categories into which
the Group classifies its debt instruments:

2.12 Financial assets and liabilities

2.12.2 Amortised cost

2.12.1 Classification

The Group classifies its financial assets in the following
measurement categories:

those to be measured at amortised cost.

those to be measured subsequently at fair value
through OCI, and.

those to be measured subsequently at fair value
through profit or loss.

The classification of financial assets at initial recogni-
tion depends on the financial asset’s contractual cash
flow characteristics and the Group’s and the Compa-
ny’s business model for managing them. In order
for a financial asset to be classified and measured at
amortised cost, it needs to give rise to cash flows that
are ‘solely payments of principal and interest’ (‘SPPI’)
on the principal amount outstanding. This assessment
is referred to as the SPPI test and is performed at an
instrument level.

For assets measured at fair value, gains and losses
will either be recorded in profit or loss or OCI. For
investments in equity instruments that are not held
for trading, this will depend on whether the group
has made an irrevocable election at the time of initial
recognition to account for the equity investment at fair
value through other comprehensive income (FVOCI).

The Group reclassifies debt investments when and
only when its business model for managing those
assets changes.

Regular way purchases and sales of financial assets
are recognised on trade-date, the date on which the
Group commits to purchase or sell the asset.

At initial recognition, the Group measures a financial
asset at its fair value plus, in the case of a financial
asset not at fair value through profit or loss (FVPL),
transaction costs that are directly attributable to the
acquisition of the financial asset. Transaction costs of
financial assets carried at FVPL are expensed in profit
or loss.

Assets that are held for collection of contractual
cash flows where those cash flows represent solely
payments of principal and interest are measured at
amortised cost. Interest income from these financial
assets is included in finance income using the effec-
tive interest rate method. Any gain or loss arising on
derecognition is recognised directly in profit or loss
and presented in other gains/(losses) together with
foreign exchange gains and losses.

Impairment losses are presented as separate line item
in the statement of profit or loss.

The Company´s financial assets at amortised cost
include current and non-current receivables (other
than trade receivables which are measured at fair
value through profit and loss) and cash and cash
equivalents.

2.12.3 Fair value through other comprehensive
income

Financial assets which are debt instruments, that are
held for collection of contractual cash flows and for
selling the financial assets, where the assets’ cash
flows represent solely payments of principal and
interest, are measured at FVOCI. Movements in the
carrying amount are taken through OCI, except for
the recognition of impairment gains or losses, interest
income and foreign exchange gains and losses which
are recognised in profit or loss. When the financial
asset is derecognised, the cumulative gain or loss
previously recognised in OCI is reclassified from equity
to profit or loss and recognised in other gains/(losses).
Interest income from these financial assets is included
in finance income using the effective interest rate
method. Foreign exchange gains and losses are
presented in net foreign exchange gain/(loss) before
tax and impairment expenses are presented as a
separate line item in the statement of profit or loss.

At transition to IFRS 9, the Group had certain financial
asset that were accounted for as debt instruments at
fair value through other comprehensive income.

Atalaya Mining Plc.

Notes to the Consolidated and Company Financial Statements

Consolidated and Company Financial Statements

123

2.12.4 Equity instruments designated as fair value
through other comprehensive income

Upon initial recognition, the Group can elect to
classify irrevocably its equity investments as equity
instruments designated at fair value through OCI
when they meet the definition of equity under IAS 32
Financial Instruments: Presentation and are not held
for trading. The classification is determined on an
instrument-by-instrument basis.

Gains and losses on these financial assets are never
recycled to profit or loss. Dividends are recognised
as other income in the consolidated and company
statements of comprehensive income when the right
of payment has been established, except when the
Group benefits from such proceeds as a recovery of
part of the cost of the financial asset, in which case,
such gains are recorded in OCI. Equity instruments
designated at fair value through OCI are not subject to
impairment assessment.

The Group elected to classify irrevocably its listed
equity investments under this category.

original effective interest rate. The expected cash flows
will include cash flows from the sale of collateral held
or other credit enhancements that are integral to the
contractual terms.

For receivables (other than trade receivables which
are measured at FVPL), the Group applies the simpli-
fied approach permitted by IFRS 9, which requires
expected lifetime losses to be recognised from initial
recognition of the receivables.

The Group considers a financial asset in default when
contractual payments are 90 days past due. However,
in certain cases, the Group may also consider a finan-
cial asset to be in default when internal or external
information indicates that the Group is unlikely to
receive the outstanding contractual amounts in full
before taking into account any credit enhancements
held by the Group. A financial asset is written off when
there is no reasonable expectation of recovering the
contractual cash flows and usually occurs when past
due for more than one year and not subject to enforce-
ment activity.

2.12.5 Assets at fair value through profit and loss

2.12.8. Financial liabilities and trade payables

Assets that do not meet the criteria for amortised
cost or FVOCI are measured at FVPL. A gain or loss
on a debt investment that is subsequently measured
at FVPL is recognised as profit or loss and presented
net within other gains/(losses) in the period in which
it arises.

Changes in the fair value of financial assets at FVPL are
recognised in other gains/(losses) in the consolidated
and company statements of comprehensive income as
applicable. The Company’s and Group’s financial assets
at fair value through profit and loss include current
and non-current receivables (other than trade receiva-
bles which are measured at amortised cost).

2.12.6 De-recognition of financial assets

Financial assets are derecognised when the rights
to receive cash flows from the financial assets have
expired or have been transferred and the Group has
transferred substantially all the risks and rewards of
ownership.

2.12.7 Impairment of financial assets

The Group assesses on a forward looking basis the
expected credit losses associated with its debt
instruments carried at amortised cost. Expected
credit losses are based on the difference between the
contractual cash flows due in accordance with the
contract and all the cash flows that the Group expects
to receive, discounted at an approximation of the

After initial recognition, interest-bearing loans and
borrowings and trade and other payables are subse-
quently measured at amortised cost using the EIR
method. Gains and losses are recognised in the consol-
idated and company statements of comprehensive
income when the liabilities are derecognised, as well
as through the EIR amortisation process.

Amortised cost is calculated by taking any discount or
premium on acquisition and fees or costs that are an
integral part of the EIR, into account. The EIR amorti-
sation is included as finance costs in the consolidated
and company statements of comprehensive income.

2.13 Current versus Non-current
Classification

The Group presents assets and liabilities in the consol-
idated and company statements of financial position
based on current/non-current classification.

(a) An asset is current when it is either:

ݖ Expected to be realised or intended to be sold or

consumed in normal operating cycle;

ݖ Held primarily for the purpose of trading;

ݖ Expected to be realised within 12 months after

the reporting period

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

Atalaya Mining Plc.

124

Consolidated and Company Financial Statements

Notes to the Consolidated and Company Financial Statements

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

ݖ Cash or cash equivalent unless restricted from

being exchanged or used to settle a liability for at
least 12 months after the reporting period

All other assets are classified as non-current.

(b) A liability is current when either:

ݖ It is expected to be settled in the normal oper-

ating cycle;

ݖ It is held primarily for the purpose of trading

ݖ It is due to be settled within 12 months after the

reporting period

ݖ There is no unconditional right to defer the

settlement of the liability for at least 12 months
after the reporting period

The Group classifies all other liabilities as non-current.

Deferred tax assets and liabilities are classified as
non-current assets and liabilities.

2.14 Cash and cash equivalents

In the consolidated and company statements of cash
flows, cash and cash equivalents includes cash in hand
and in bank including deposits held at call with banks,
with a maturity of less than 3 months.

2.15 Provisions

Provisions are recognised when: The Group has a
present legal or constructive obligation as a result of
past events; it is probable that an outflow of resources
will be required to settle the obligation; and the
amount has been reliably estimated. Provisions are not
recognised for future operating losses.

2.16 Interest-bearing loans and borrowings

Where there are a number of similar obligations,
the likelihood that an outflow will be required in
settlement is determined by considering the class of
obligations as a whole. A provision is recognised even
if the likelihood of an outflow with respect to any one
item included in the same class of obligations may be
small. Provisions are measured at the present value
of the expenditures expected to be required to settle
the obligation using a pre-tax rate that reflects current
market assessments of the time value of money and
the risks specific to the obligation. The increase in
the provision due to passage of time is recognised as
interest expense.

Borrowings are recognised initially at fair value, net
of transaction costs incurred. Borrowings are subse-
quently stated at amortised cost. Any difference
between the proceeds (net of transaction costs) and
the redemption value is recognised in profit or loss
over the period of the borrowings, using the effective
interest method, unless they are directly attributable
to the acquisition, construction or production of a
qualifying asset, in which case they are capitalised as
part of the cost of that asset.

Fees paid on the establishment of loan facilities are
recognised as transaction costs of the loan to the
extent that it is probable that some or all of the facility
will be drawn down. In this case, the fee is deferred
until the draw-down occurs. To the extent there is
no evidence that it is probable that some or all of the
facility will be drawn down, the fee is capitalised as
a prepayment and amortised over the period of the
facility to which it relates.

Borrowing costs are interest and other costs that the
Group incurs in connection with the borrowing of
funds, including interest on borrowings, amortisa-
tion of discounts or premium relating to borrowings,
amortisation of ancillary costs incurred in connec-
tion with the arrangement of borrowings, finance
lease charges and exchange differences arising from
foreign currency borrowings to the extent that they are
regarded as an adjustment to interest costs.

2.17 Deferred consideration

Deferred consideration arises when settlement of all
or any part of the cost of an agreement is deferred. It
is stated at fair value at the date of recognition, which
is determined by discounting the amount due to
present value at that date. Interest is imputed on the
fair value of non-interest-bearing deferred considera-
tion at the discount rate and expensed within interest
payable and similar charges. At each balance sheet
date deferred consideration comprises the remaining
deferred consideration valued at acquisition plus
interest imputed on such amounts from recognition to
the balance sheet date.

2.18 Share capital

Ordinary shares are classified as equity. The difference
between the fair value of the consideration received
by the Company and the nominal value of the share
capital being issued is taken to the share premium
account.

Incremental costs directly attributable to the issue
of new ordinary shares are shown in equity as a
deduction, net of tax, from the proceeds in the share
premium account.

Atalaya Mining Plc.

Notes to the Consolidated and Company Financial Statements

Consolidated and Company Financial Statements

125

2.19 Current and deferred income tax

2.20 Share-based payments

The tax expense for the period comprises current and
deferred tax. Tax is recognised in the income state-
ment, except to the extent that it relates to items
recognised in other comprehensive income or directly
in equity. In this case, the tax is also recognised in
other comprehensive income or directly in equity,
respectively.

The current income tax charge is calculated on
the basis of the tax laws enacted or substantively
enacted at the end of the reporting period date in the
countries where the Company and its subsidiaries
operate and generate taxable income. Management
periodically evaluates positions taken in tax returns
with respect to situations in which applicable tax
regulation is subject to interpretation. It establishes
provisions where appropriate on the basis of amounts
expected to be paid to the tax authorities.

Deferred income tax is recognised, using the liability
method, on temporary differences arising between
the tax bases of assets and liabilities and their carrying
amounts in the consolidated financial statements.
However, deferred tax liabilities are not recognised
if they arise from the initial recognition of goodwill;
deferred income tax is also not recognised if it arises
from initial recognition of an asset or liability in a
transaction other than a business combination that at
the time of the transaction affects neither accounting
nor taxable profit or loss. Income tax is determined
using tax rates (and laws) that have been enacted or
substantively enacted by the end of the reporting
period date and are expected to apply when the
related deferred tax asset is realised or the deferred
income tax liability is settled. Deferred tax assets are
recognised only to the extent that it is probable that
future taxable profit will be available against which the
temporary differences can be utilised.

Deferred income tax is provided on temporary differ-
ences arising on investments in subsidiaries and asso-
ciates, except for deferred income tax liabilities where
the timing of the reversal of the temporary difference
is controlled by the Group and it is probable that the
temporary difference will not reverse in the foresee-
able future.

Deferred tax assets and liabilities are offset when
there is a legally enforceable right to offset current
tax assets against current tax liabilities and when the
deferred income tax assets and liabilities relate to
income taxes levied by the same taxation authority
on either the same taxable entity or different taxable
entities where there is an intention to settle the
balances on a net basis.

The Group operates a share-based compensation
plan, under which the entity receives services from
employees as consideration for equity instruments
(options) of the Group. The fair value of the employee
services received in exchange for the grant of the
options is recognised as an expense. The fair value is
measured using the Black Scholes pricing model. The
inputs used in the model are based on management’s
best estimates for the effects of non-transferability,
exercise restrictions and behavioural considerations.
Non-market performance and service conditions are
included in assumptions about the number of options
that are expected to vest.

Vesting conditions are: (i) the personnel should be an
employee that provides services to the Group; and (ii)
should be in continuous employment for the whole
vesting period of 3 years. Specific arrangements may
exist with senior managers and board members,
whereby their options stay in use until the end.

The total expense is recognised over the vesting period,
which is the period over which all of the specified
vesting conditions are to be satisfied (Note 23).

2.21 Rehabilitation provisions

The Group records the present value of estimated costs
of legal and constructive obligations required to restore
operating locations in the period in which the obliga-
tion is incurred. The nature of these restoration activ-
ities includes dismantling and removing structures,
rehabilitating mines and tailings dams, dismantling
operating facilities, closure of plant and waste sites and
restoration, reclamation and re-vegetation of affected
areas. The obligation generally arises when the asset
is installed, or the ground/environment is disturbed at
the production location. When the liability is initially
recognised, the present value of the estimated cost is
capitalised by increasing the carrying amount of the
related mining assets to the extent that it was incurred
prior to the production of related ore. Over time, the
discounted liability is increased for the change in
present value based on the discount rates that reflect
current market assessments and the risks specific to
the liability. The periodic unwinding of the discount is
recognised in the consolidated income statement as
a finance cost. Additional disturbances or changes in
rehabilitation costs will be recognised as additions or
charges to the corresponding assets and rehabilitation
liability when they occur. For closed sites, changes to
estimated costs are recognised immediately in the
consolidated income statement.

The Group assesses its mine rehabilitation provision
annually. Significant estimates and assumptions are

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

Atalaya Mining Plc.

126

Consolidated and Company Financial Statements

Notes to the Consolidated and Company Financial Statements

made in determining the provision for mine rehabil-
itation as there are numerous factors that will affect
the ultimate liability payable. These factors include
estimates of the extent and costs of rehabilitation
activities, technological changes, regulatory changes
and changes in discount rates. Those uncertainties
may result in future actual expenditure differing
from the amounts currently provided. The provision
at the consolidated statement of financial position
date represents management’s best estimate of
the present value of the future rehabilitation costs
required.

2.22 Leases

The determination of whether an arrangement is,
or contains a lease is based on the substance of the
arrangement at inception date including whether the
fulfilment of the arrangement is dependent on the
use of a specific asset or assets or the arrangement
conveys a right to use the asset.

The Group assesses at contract inception whether a
contract is, or contains, a lease. That is, if the contract
conveys the right to control the use of an identified
asset for a period of time in exchange for consideration.

The Group applies a single recognition and measure-
ment approach for all leases, except for short-term
leases and leases of low-value assets. The Group
recognises lease liabilities to make lease payments
and right-of-use assets representing the right to use
the underlying assets.

A reassessment is made after inception of the lease
only if one of the following applies:

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

Generally, the Group is restricted from assigning and
subleasing the leased assets.

> Right-of-use assets

The Group recognises right-of-use assets at the
commencement date of the lease (i.e., the date the
underlying asset is available for use). Right-of-use
assets are measured at cost, less any accumulated
depreciation and impairment losses, and adjusted for
any remeasurement of lease liabilities.

The cost of right-of-use assets includes the amount
of lease liabilities recognised, initial direct costs
incurred, and lease payments made at or before
the commencement date less any lease incentives
received. Unless the Group is reasonably certain to
obtain ownership of the leased asset at the end of
the lease term, the recognised right-of-use assets are
depreciated on a straight-line basis over the shorter
of its estimated useful life and the lease term. Right-
of-use assets are subject to impairment.

After initial measurement, the right-of-use assets are
depreciated from the commencement date using the
straight-line method over the shorter of the estimated
useful lives of the right-of-use assets or the end of
lease term. These are as follows:

Right-of-use asset

Depreciation terms in
years

Lands and buildings

Motor vehicles

Based on Units of
Production (UOP)

Based on straight line
depreciation

a) There is a change in contractual terms, other than a
renewal or extension of the arrangement;

Laboratory equipment

b) A renewal option is exercised, or extension granted,
unless the term of the renewal or extension was
initially included in the lease term;

c) There is a change in the determination of whether
fulfilment is dependent on a specified asset; or

d) There is a substantial change to the asset.

After the commencement date, the right-of-use assets
are measured at cost less any accumulated depreci-
ation and any accumulated impairment losses and
adjusted for any remeasurement of the lease liability.

Group as a lessee

> Lease liabilities

The Group has lease contracts for various items of
laboratory equipment, motor vehicle, lands and build-
ings used in its operations. Leases of laboratory equip-
ment and motor vehicles generally have lease terms
for four years, while lands and buildings generally have
lease terms for the life of mine, currently after 13 years
of operation. The Group’s obligations under its leases
are secured by the lessor’s title to the leased assets.

The lease liability is initially measured at the present
value of the lease payments that are not paid at the
commencement date, discounted using the interest
rate implicit in the lease or, if that rate cannot be
readily determined, the Group’s incremental borrowing
rate. Generally, the Group uses its incremental
borrowing rate as the discount rate. Lease payments
included in the measurement of the lease liability
include the following:

Atalaya Mining Plc.

Notes to the Consolidated and Company Financial Statements

Consolidated and Company Financial Statements

127

» Fixed payments, less any lease incentives receivable

» Variable lease payments that depend on an index or
rate, initially measured using the index or rate as at
the commencement date

expects to be entitled in exchange for those goods or
services. Atalaya has concluded that it is the principal
in its revenue contracts because it controls the goods
or services before transferring them to the customer.

» Amounts expected to be payable by the lessee

under residual value guarantees

» The exercise price of a purchase option if the lessee

is reasonably certain to exercise that option

» Lease payments in an optional renewal period if the
Group is reasonably certain to exercise an extension
option

» Payments of penalties for early terminating the

lease, unless the Group is reasonably certain not to
terminate early.

The lease liability is measured at amortised cost
using the effective interest rate method. After the
commencement date, the amount of lease liabilities
is increased to reflect the accretion of interest and
reduced for the lease payments made. In addition, the
carrying amount of lease liabilities is re-measured if
there is a modification, a change in the lease term, a
change in the in-substance fixed lease payments or a
change in the assessment to purchase the underlying
asset. The result of this re-measurement is disclosed in
a line of the right-of-use assets note as modifications.

When the lease liability is remeasured, a corre-
sponding adjustment is made to the carrying amount
of the right-of-use asset or is recorded as profit or loss
if the carrying amount of the right-of-use asset has
been reduced to zero.

> Short-term leases and leases of low-value assets

The Group applies the short-term lease recognition
exemption to its short-term leases of machinery and
equipment (i.e., those leases that have a lease term of 12
months or less from the commencement date and do
not contain a purchase option). It also applies the lease
of low-value assets recognition exemption to leases
of office equipment that are considered of low value
(i.e., below €5,000). Lease payments on short-term
leases and leases of low-value assets are recognised as
expense on a straight-line basis over the lease term.

2.23 Revenue recognition

(a) Revenue from contracts with customers

Atalaya is principally engaged in the business of pro-
ducing copper concentrate and in some instances,
provides freight/shipping services. Revenue from con-
tracts with customers is recognised when control of the
goods or services is transferred to the customer at an
amount that reflects the consideration to which Atalaya

(b) Copper in concentrate (metal in concentrate)
sales

For most copper in concentrate (metal in concen-
trate) sales, the enforceable contract is each purchase
order, which is an individual, short-term contract.
For the Group’s metal in concentrate sales not sold
under CIF Incoterms, the performance obligations
are the delivery of the concentrate. A proportion of
the Group’s metal in concentrate sales are sold under
CIF Incoterms, whereby the Group is also responsible
for providing freight services. In these situations, the
freight services also represent separate performance
obligation (see paragraph (c) below).

The majority of the Group’s sales of metal in concentrate
allow for price adjustments based on the market price
at the end of the relevant QP stipulated in the contract.
These are referred to as provisional pricing arrange-
ments and are such that the selling price for metal
in concentrate is based on prevailing spot prices on a
specified future date after shipment to the customer.
Adjustments to the sales price occur based on move-
ments in quoted market prices up to the end of the QP.
The period between provisional invoicing and the end of
the QP can be between one and three months.

Revenue is recognised when control passes to the
customer, which occurs at a point in time when the
metal in concentrate is physically transferred onto a
vessel, train, conveyor or other delivery mechanism.
The revenue is measured at the amount to which the
Group expects to be entitled, being the estimate of the
price expected to be received at the end of the QP, i.e.,
the forward price, and a corresponding trade receiv-
able is recognised. For those arrangements subject to
CIF shipping terms, a portion of the transaction price is
allocated to the separate freight services provided (See
paragraph (c) below).

For these provisional pricing arrangements, any future
changes that occur over the QP are included within
the provisionally priced trade receivables and are,
therefore, within the scope of IFRS 9 and not within the
scope of IFRS 15. Given the exposure to the commodity
price, these provisionally priced trade receivables will
fail the cash flow characteristics test within IFRS 9 and
will be required to be measured at fair value through
profit or loss up from initial recognition and until
the date of settlement. These subsequent changes
in fair value are recognised as part of revenue in the
statement of profit or loss and other comprehensive
income each period and disclosed separately from

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

Atalaya Mining Plc.

128

Consolidated and Company Financial Statements

Notes to the Consolidated and Company Financial Statements

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

revenue from contracts with customers as part of
‘Fair value gains/losses on provisionally priced trade
receivables. Changes in fair value over, and until the
end of, the QP, are estimated by reference to updated
forward market prices for copper as well as taking
other relevant fair value considerations as set out in
IFRS 13, into account, including interest rate and credit
risk adjustments.

Final settlement is based on quantities adjusted as
required following the inspection of the product by
the customer as well as applicable commodity prices.
IFRS 15 requires that variable consideration should only
be recognised to the extent that it is highly probable
that a significant reversal in the amount of cumulative
revenue recognized will not occur. As the adjustments
relating to the final assay results for the quantity and
quality of concentrate sold are not significant, they do
not constrain the recognition of revenue.

As noted above, a proportion of the Group’s metal
in concentrate sales are sold under CIF Incoterms,
whereby the Group is responsible for providing
freight services (as principal) after the date that the
Group transfers control of the metal in concentrate
to its customers. The Group, therefore, has separate
performance obligation for freight services which are
provided solely to facilitate sale of the commodities it
produces.

The revenue from freight services is a separate
performance obligation under IFRS 15 and therefore
is recognised as the service is provided, hence at year
end a portion of revenue must be deferred as well as
the insurance costs associated.

Other Incoterms commonly used by the Group are
FOB, where the Group has no responsibility for freight
or insurance once control of the products has passed
at the loading port, Ex works where control of the
goods passes when the product is picked up at seller´s
promises, and CIP where control of the goods passes
when the product is delivered to the agreed destina-
tion. For arrangements which have these Incoterms,
the only performance obligations are the provision of
the product at the point where control passes.

Contract assets

A contract asset is the right to consideration in
exchange for goods or services transferred to the
customer. If the Group performs by transferring goods
or services to a customer before the customer pays
consideration or before payment is due, a contract
asset is recognised for the earned consideration that
is conditional. The Group does not have any contract
assets as performance and a right to consideration
occurs within a short period of time and all rights to
consideration are unconditional.

Contract liabilities

A contract liability is the obligation to transfer goods
or services to a customer for which the Group has
received consideration (or an amount of consideration
is due) from the customer. If a customer pays consid-
eration before the Group transfers goods or services to
the customer, a contract liability is recognised when
the payment is made or the payment is due (which-
ever is earlier). Contract liabilities are recognised as
revenue when the Group performs under the contract.

From time to time, the Group recognises contract
liabilities in relation to some metal in concentrate sales
which are sold under CIF Incoterms, whereby a portion
of the cash may be received from the customer before
the freight services are provided.

2.24 Interest income

Interest income is recognised using the effective
interest method. When a loan and receivable is
impaired, the Group and the Company reduce the
carrying amount to its recoverable amount, the esti-
mated future cash flow is discounted at the original
effective interest rate of the instrument and the
discount continues unwinding as interest income.
Interest income on impaired loan and receivables is
recognised using the original effective interest rate.

2.25 Dividend income

Dividend income is recognised when the right to
receive payment is established.

(d) Sales of services

2.26 Dividend distribution

The Group sells services in relation to maintenance of
accounting records, management, technical, adminis-
trative support and other services to other companies.
Revenue is recognised in the accounting period in
which the services are rendered.

Dividend distributions to the Company’s shareholders
are recognised as a liability in the Group’s financial
statements in the period in which the dividends are
approved by the Company’s shareholders.

Atalaya Mining Plc.

Notes to the Consolidated and Company Financial Statements

Consolidated and Company Financial Statements

129

2.27 Earnings per share

Basic earnings per share is calculated by dividing
the net profit for the year by the weighted average
number of ordinary shares outstanding during the
year. The basic and diluted earnings per share are the
same as there are no instruments that have a dilutive
effect on earnings.

2.28 Comparatives

for financial assets held by the Group is the current bid
price. The appropriate quoted market price for financial
liabilities is the current ask price.

The fair value of financial instruments that are not
traded in an active market is determined by using
valuation techniques. The Group uses a variety of
methods, such as estimated discounted cash flows,
and makes assumptions that are based on market
conditions existing at the reporting date.

Where necessary, comparative figures have been
adjusted to conform to changes in presentation in the
current year. No changes with 2021.

■ Fair value measurements recognised in the

consolidated and company statement of financial
position

2.29 Amendment of financial statements
after issue

The consolidated and company financial statements
were authorised for issue by the Board of Directors
on 21 March 2023. The Board of Directors and share-
holders has no right to amend the Financial State-
ments after they are authorised.

2.30 Fair value estimation

The fair values of the Group’s financial assets and
liabilities approximate their carrying amounts at the
reporting date.

The fair value of financial instruments traded in active
markets, such as publicly traded and fair value through
profit and loss assets is based on quoted market prices
at the reporting date. The quoted market price used

The following table provides an analysis of finan-
cial instruments that are measured subsequent to
initial recognition at fair value, Grouped into Levels
1 to 3 based on the degree to which the fair value is
observable.

» Level 1 fair value measurements are those

derived from quoted prices (unadjusted) in active
markets for identical assets or liabilities.

» Level 2 fair value measurements are those

derived from inputs other than quoted prices
included within Level 1 that are observable for
the asset or liability, either directly (i.e. as prices)
or indirectly (i.e. derived from prices).

» Level 3 fair value measurements are those

derived from valuation techniques that include
inputs for the asset or liability that are not based
on observable market data (unobservable
inputs).

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

The Group

(Euro 000’s)

31 December 2022

Other current financial assets

Financial assets at FV through OCI

Trade and other receivables

Receivables (subject to provisional pricing)

Total

31 December 2021

Other current financial assets

Financial assets at FV through OCI

Trade and other receivables

Receivables (subject to provisional pricing)

Total

Level 1

Level 2

Level 3

Total

27,557

29,148

1,101

1,134

27,557

28,691

1,140

29,148

30,288

Atalaya Mining Plc.

130

Consolidated and Company Financial Statements

Notes to the Consolidated and Company Financial Statements

The Company

(Euro 000’s)

31 December 2022

Non-current receivables

Financial assets at FV through profit and loss (note 30.4)

Other current financial assets

Financial assets at FV through OCI

Total

31 December 2021

Non-current receivables

Financial assets at FV through profit and loss (note 30.4)

Other current financial assets

Financial assets at FV through OCI

Total

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

3. Financial Risk
Management and Critical
accounting estimates and
judgements

3.1 Financial risk factors

The Group manages its exposure to key financial
risks in accordance with its financial risk manage-
ment policy. The objective of the policy is to support
the delivery of the Group’s financial targets while
protecting future financial security. The main risks
that could adversely affect the Group’s financial
assets, liabilities or future cash flows are market risks
comprising: commodity price risk, interest rate risk
and foreign currency risk; liquidity risk and credit
risk; operational risk, compliance risk and litigation
risk. Management reviews and agrees policies for
managing each of these risks that are summarised
below.

The Group’s senior management oversees the
management of financial risks. The Group’s senior
management is supported by the AFRC that advises
on financial risks and the appropriate financial risk
governance framework for the Group. The AFRC
provides assurance to the Group’s senior manage-
ment that the Group’s financial risk-taking activities
are governed by appropriate policies and procedures
and that financial risks are identified, measured and

Level 1

Level 2

Level 3

Total

14,247

14,280

176,292

176,331

managed in accordance with the Group’s policies and
risk objectives. Currently, the Group does not apply
any form of hedge accounting.

(a) Liquidity risk

Liquidity risk is the risk that arises when the maturity
of assets and liabilities does not match. An unmatched
position potentially enhances profitability but can also
increase the risk of losses. The Group has procedures
with the object of minimising such losses such as
maintaining sufficient cash to meet liabilities when
due. Cash flow forecasting is performed in the oper-
ating entities of the Group and aggregated by Group
finance. Group finance monitors rolling forecasts of the
Group’s liquidity requirements to ensure it has suffi-
cient cash to meet operational needs.

The following tables detail the Group’s remaining
contractual maturity for its financial liabilities. The
tables have been drawn up based on the undis-
counted cash flows of financial liabilities based on the
earliest date on which the Group can be required to
pay. The table includes principal cash flows.

Notes to the Consolidated and Company Financial Statements

Consolidated and Company Financial Statements

131

Other financial liabilities

73,362

The Group

(Euro 000’s)

31 December 2022

Tax liability

Lease liability

Non-current payables

Trade and other payables

31 December 2021

Tax liability

Deferred consideration

Trade and other payables

Lease liability

The Company

(Euro 000’s)

31 December 2022

Tax liability

Trade and other payables

31 December 2021

Trade and other payables

Carrying
amounts

Contractual
cash flows

Less than 3
months

Between
3 – 12
months

Between
1 – 2 years

Between
2 – 5 years

Over 5
years

1,425

4,914

1,425

4,914

2,015

90,023

171,739

336

47,444

69,641

5,510

86,810

166,511

336

47,444

53,977

5,510

53,913

32,593

1,425

536

52,594

10,812

36,110

90,680

336

13,394

33,613

597

28,425

122,931

107,267

32,593

47,940

28,425

1,957

9,956

5,625

2,014

7,639

2,421

2,000

4,421

3,435

2,899

6,334

10,812

11,913

Carrying
amounts

Contractual
cash flows

Less than 3
months

Between
3 – 12
months

Between
1 – 2 years

Between
2 – 5 years

Over 5
years

107

5,401

5,508

2,013

107

543

650

493

107

5,401

5,508

2,013

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

(b) 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 trans-
actions and recognised assets and liabilities are
denominated in a currency that is not the Group’s
measurement currency. The Group is exposed to
foreign exchange risk arising from various currency
exposures primarily with respect to the US Dollar and

the British Pound. The Group’s management monitors
the exchange rate fluctuations on a continuous basis
and acts accordingly.

Foreign currency sensitivity

The following table demonstrates the sensitivity to a
reasonably possible change in the foreign exchange
rate, with all other variables held constant, of the
Group’s profit before tax due to changes in the carrying
value of monetary assets and liabilities at reporting
date:

(Euro 000’s)

+5%

-5%

Effect on profit before tax for the year ended
31 Dec 2022 increase/(decrease)

Effect on profit before tax for the year ended
31 Dec 2021 increase/(decrease)

17,303

(17,303)

15,045

(15,045)

Atalaya Mining Plc.

132

Consolidated and Company Financial Statements

Notes to the Consolidated and Company Financial Statements

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

Commodity price is the risk that the Group’s future
earnings will be adversely impacted by changes in
the market prices of commodities, primarily copper.
Management is aware of this impact on its primary
revenue stream but knows that there is little it can do
to influence the price earned apart from a hedging
scheme.

Commodity price hedging is governed by the Group´s
policy which allows to limit the exposure to prices.
The Group may decide to hedge part of its production
during the year.

Commodity price sensitivity

The table below summarises the impact on profit
before tax for changes in commodity prices on the
fair value of derivative financial instruments and trade
receivables (subject to provisional pricing). The impact
on equity is the same as the impact on profit before
income tax as these derivative financial instruments
have not been designated as hedges and are classi-
fied as held-for-trading and are therefore fair valued
through profit or loss.

The analysis is based on the assumption that the
copper prices move $0.05/lb with all other variables
held constant. Reasonably possible movements in
commodity prices were determined based on a review
of the last two years’ historical prices.

Effect on profit
before tax for the
year ended 31 Dec
2022 increase/
(decrease)

Effect on profit
before tax for the
year ended 31 Dec
2021 increase/
(decrease)

(Euro 000’s)

Increase/(decrease) in copper prices

Increase $0.05/lb
(2021: $0.05)

Decrease $0.05/lb
(2021: $0.05)

(d) Credit risk

5,285

4,920

(5,285)

(4,920)

Credit risk arises when a failure by counterparties to
discharge their obligations could reduce the amount
of future cash inflows from financial assets on hand
at the reporting date. The Group has no significant
concentration of credit risk. The Group has policies in
place to ensure that sales of products and services are
made to customers with an appropriate credit history
and monitors on a continuous basis the ageing profile
of its receivables. The Group has policies to limit the
amount of credit exposure to any financial institution.

Except as detailed in the following table, the carrying
amount of financial assets recorded in the financial
statements, which is net of impairment losses, repre-
sents the maximum credit exposure without taking
account of the value of any collateral obtained:

(Euro 000’s)

31 Dec
2022

31 Dec
2021

Unrestricted cash and cash equivalents at
Group level

108,550

48,375

Unrestricted cash and cash equivalents at
Operation level

17,567

43,722

Restricted cash and cash equivalents at
Operation level

331

15,420

Consolidated cash and cash equivalents

126,448

107,517

Net cash position(1)

53,085

60,073

Working capital surplus

84,047

102,430

(1) Includes restricted cash and bank borrowings at 31 December
2022 and 2021.

As at 31 December 2022, the Group’s operating subsid-
iary held restricted cash of €0.3 million of a provision
for legal costs related to Astor (2021: €15.4 million).

Besides of the above, there are no collaterals held in
respect of these financial instruments and there are no
financial assets that are past due or impaired as at 31
December 2022.

(e) Interest rate risk

Interest rate risk is the risk that the value of financial
instruments will fluctuate due to changes in market
interest rates. 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 inter-
estbearing financial instruments was:

(Euro 000’s)

2022

2021

Variable rate instruments

Financial assets

126,448

107,517

Atalaya Mining Plc.

Notes to the Consolidated and Company Financial Statements

Consolidated and Company Financial Statements

133

An increase of 100 basis points in interest rates at 31
December 2022 would have increased / (decreased)
equity and profit or loss by the amounts shown below.
This analysis assumes that all other variables, in
particular foreign currency rates, remain constant. For
a decrease of 100 basis points there would be an equal
and opposite impact on the profit and other equity.

In order to maintain or adjust the capital structure,
the Group issues new shares. The Group manages its
capital to ensure that it will be able to continue as a
going concern while maximising the return to share-
holders through the optimisation of the debt and
equity balance. The AFRC reviews the capital structure
on a continuing basis.

Equity

Profit or loss

(Euro 000’s)

2022

2021

2022

2021

Variable rate instruments

1,264

1,075

1,264

1,075

(f) Operational risk

Operational risk is the risk that derives from the defi-
ciencies relating to the Group’s information technology
and control systems as well as the risk of human error
and natural disasters. The Group’s systems are evalu-
ated, maintained and upgraded continuously.

The Group’s objectives when managing capital are to
safeguard the Group’s ability to continue as a going
concern and to maintain an optimal capital structure
so as to maximise shareholder value. In order to main-
tain or achieve an optimal capital structure, the Group
may adjust the amount of dividend payment, return
capital to shareholders, issue new shares, buy back
issued shares, obtain new borrowings or sell assets to
reduce borrowings.

The Group monitors capital on the basis of the gearing
ratio. The gearing ratio is calculated as net debt
divided by total capital. Net debt is calculated as provi-
sions plus deferred consideration plus trade and other
payables less cash and cash equivalents.

(g) Compliance risk

(Euro 000’s)

2022

2021

Compliance risk is the risk of financial loss, including
fines and other penalties, which arises from noncom-
pliance with laws and regulations. The Group has
systems in place to mitigate this risk, including
seeking advice from external legal and regulatory advi-
sors in each jurisdiction.

3. Financial Risk Management and Critical accounting
estimates and judgements (cont.)

(h) Litigation risk

Litigation risk is the risk of financial loss, interruption
of the Group’s operations or any other undesirable
situation that arises from the possibility of nonexecu-
tion or violation of legal contracts and consequentially
of lawsuits. The risk is restricted through the contracts
used by the Group to execute its operations.

3.2 Capital risk management

The Group considers its capital structure to consist
of share capital, share premium and share options
reserve. The Group’s objectives when managing
capital are to safeguard the Group’s ability to continue
as a going concern in order to provide returns for
shareholders and benefits for other stakeholders and
to maintain an optimal capital structure to reduce the
cost of capital. The Group is not subject to any exter-
nally imposed capital requirements.

Total liabilities less cash

70,326

41,992

Total equity

Total capital

473,295

440,807

543,621

482,799

Gearing ratio

12.94%

8.70%

3.3 Critical accounting estimates and
judgements

The preparation of the financial statements requires
management to make judgements, estimates and
assumptions that affect the reported amounts of reve-
nues, expenses, assets and liabilities, and the accom-
panying disclosures, and the disclosure of contingent
liabilities at the date of the consolidated financial
statements. Estimates and assumptions are continu-
ally evaluated and are based on management’s expe-
rience and other factors, including expectations of
future events that are believed to be reasonable under
the circumstances. Uncertainty about these assump-
tions and estimates could result in outcomes that
require a material adjustment to the carrying amount
of assets or liabilities affected in future periods.

In particular, the Group has identified a number of
areas where significant judgements, estimates and
assumptions are required.

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

Atalaya Mining Plc.

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

134

Consolidated and Company Financial Statements

Notes to the Consolidated and Company Financial Statements

(a) Capitalisation of exploration and evaluation costs

Under the Group’s accounting policy, exploration and
evaluation expenditure is not capitalised until the
point is reached at which there is a high degree of
confidence in the project’s viability, and it is consid-
ered probable that future economic benefits will flow
to the Group. Subsequent recovery of the resulting
carrying value depends on successful development or
sale of the undeveloped project. If a project proves to
be unviable, all irrecoverable costs associated with the
project net of any related impairment provisions are
written off.

(b) Stripping costs

The Group incurs waste removal costs (stripping costs)
during the development and production phases of
its surface mining operations. Furthermore, during
the production phase, stripping costs are incurred in
the production of inventory as well as in the creation
of future benefits by improving access and mining
flexibility in respect of the orebodies to be mined, the
latter being referred to as a stripping activity asset.
Judgement is required to distinguish between the
development and production activities at surface
mining operations.

The Group is required to identify the separately iden-
tifiable components or phases of the orebodies for
each of its surface mining operations. Judgement is
required to identify and define these components,
and also to determine the expected volumes (tonnes)
of waste to be stripped and ore to be mined in each
of these components. These assessments may vary
between mines because the assessments are under-
taken for each individual mine and are based on a
combination of information available in the mine
plans, specific characteristics of the orebody, the mile-
stones relating to major capital investment decisions
and the type and grade of minerals being mined.

Judgement is also required to identify a suitable
production measure that can be applied in the calcu-
lation and allocation of production stripping costs
between inventory and the stripping activity asset.
The Group considers the ratio of expected volume of
waste to be stripped for an expected volume of ore
to be mined for a specific component of the orebody,
compared to the current period ratio of actual volume
of waste to the volume of ore to be the most suitable
measure of production.

These judgements and estimates are used to calculate
and allocate the production stripping costs to inven-
tory and/or the stripping activity asset(s). Furthermore,
judgements and estimates are also used to apply the
units of production method in determining the depre-
ciable lives of the stripping activity asset(s).

The Group estimates its ore reserves and mineral
resources based on information compiled by appropri-
ately qualified persons relating to the geological and
technical data on the size, depth, shape and grade of
the ore body and suitable production techniques and
recovery rates.

Such an analysis requires complex geological judge-
ments to interpret the data. The estimation of recover-
able reserves is based upon factors such as estimates
of foreign exchange rates, commodity prices, future
capital requirements and production costs, along with
geological assumptions and judgements made in
estimating the size and grade of the ore body.

The Group uses qualified persons (as defined by the
Canadian Securities Administrators’ National Instru-
ment 43-101) to compile this data. Changes in the
judgments surrounding proven and probable reserves
may impact as follows:

» The carrying value of exploration and evalua-

tion assets, mine properties, property, plant and
equipment, and goodwill may be affected due to
changes in estimated future cash flows;

» Depreciation and amortisation charges in the

consolidated and company statements of compre-
hensive income may change where such charges
are determined using the UOP method, or where
the useful life of the related assets change;

» Capitalised stripping costs recognised in the state-
ment of financial position as either part of mine
properties or inventory or charged to profit or loss
may change due to changes in stripping ratios;

» Provisions for rehabilitation and environmental
provisions may change where reserve estimate
changes affect expectations about when such
activities will occur and the associated cost of these
activities;

The recognition and carrying value of deferred income
tax assets may change due to changes in the judge-
ments regarding the existence of such assets and in
estimates of the likely recovery of such assets.

(d) Impairment of assets

Events or changes in circumstances can give rise
to significant impairment charges or impairment
reversals in a particular year. The Group assesses each
Cash Generating Unit (“CGU”) annually to determine
whether any indications of impairment exist. If it
was necessary management could contract inde-
pendent expert to value the assets. Where an indi-
cator of impairment exists, a formal estimate of the

Atalaya Mining Plc.

Notes to the Consolidated and Company Financial Statements

Consolidated and Company Financial Statements

135

recoverable amount is made, which is considered
the higher of the fair value less cost to sell and value-
in-use. An impairment loss is recognised immediately
in net earnings. The Group has determined that each
mine location is a CGU.

These assessments require the use of estimates and
assumptions such as commodity prices, discount
rates, future capital requirements, exploration poten-
tial and operating performance. Fair value is deter-
mined as the price that would be received to sell an
asset or paid to transfer a liability in an orderly trans-
action between market participants at the measure-
ment date. Fair value for mineral assets is generally
determined as the present value of estimated future
cash flows arising from the continued use of the asset,
which includes estimates such as the cost of future
expansion plans and eventual disposal, using assump-
tions that an independent market participant may
take into account. Cash flows are discounted at an
appropriate discount rate to determine the net present
value. For the purpose of calculating the impairment
of any asset, management regards an individual mine
or works site as a CGU.

Although management has made its best estimate of
these factors, it is possible that changes could occur
in the near term that could adversely affect manage-
ment’s estimate of the net cash flow to be generated
from its projects.

(e) Provisions for decommissioning and site restora-
tion costs

Accounting for restoration provisions requires manage-
ment to make estimates of the future costs the Group
will incur to complete the restoration and remediation
work required to comply with existing laws, regulations
and agreements in place at each mining operation and
any environmental and social principles the Group is in
compliance with. The calculation of the present value
of these costs also includes assumptions regarding the
timing of restoration and remediation work, applicable
risk-free interest rate for discounting those future cash
outflows, inflation and foreign exchange rates and
assumptions relating to probabilities of alternative
estimates of future cash outflows.

Management uses its judgement and experience to
provide for and (in the case of capitalised decommis-
sioning costs) amortise these estimated costs over the
life of the mine. The ultimate cost of decommissioning
and timing is uncertain and cost estimates can vary
in response to many factors including changes to
relevant environmental laws and regulations require-
ments, the emergence of new restoration techniques
or experience at other mine sites. As a result, there
could be significant adjustments to the provisions

established which would affect future financial results.
Refer to Note 26 for further details.

(f) Income tax

Significant judgment is required in determining the
provision for income taxes. There are transactions and
calculations for which the ultimate tax determination
is uncertain during the ordinary course of business.
The Group and Company recognise 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 income tax and deferred tax provisions
in the period in which such determination is made.

Judgement is also required to determine whether
deferred tax assets are recognised in the consolidated
statements of financial position. Deferred tax assets,
including those arising from unutilised tax losses,
require the Group to assess the probability that the
Group will generate sufficient taxable earnings in
future periods, in order to utilise recognised deferred
tax assets.

Assumptions about the generation of future taxable
profits depend on management’s estimates of future
cash flows. These estimates of future taxable income
are based on forecast cash flows from operations
(which are impacted by production and sales volumes,
commodity prices, reserves, operating costs, closure
and rehabilitation costs, capital expenditure, dividends
and other capital management transactions). To the
extent that future cash flows and taxable income differ
significantly from estimates, the ability of the Group to
realise the net deferred tax assets could be impacted.

In addition, future changes in tax laws in the jurisdic-
tions in which the Group operates could limit the ability
of the Group to obtain tax deductions in future periods.

(g) Inventory

Net realisable value tests are performed at each
reporting date and represent the estimated future
sales price of the product the entity expects to realise
when the product is processed and sold, less esti-
mated costs to complete production and bring the
product to sale. Where the time value of money is
material, these future prices and costs to complete are
discounted.

(h) Leases - Estimating the incremental borrowing
rate

The Group cannot readily determine the interest rate
implicit in the lease, therefore, it uses its incremental
borrowing rate (IBR) to measure lease liabilities.

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

Atalaya Mining Plc.

136

Consolidated and Company Financial Statements

Notes to the Consolidated and Company Financial Statements

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

The IBR is the rate of interest that the Group would
have to pay to borrow over a similar term, and with
a similar security, the funds necessary to obtain an
asset of a similar value to the right-of-use asset in
a similar economic environment. The IBR therefore
reflects what the Group ‘would have to pay’, which
requires estimation when no observable rates are
available (such as for subsidiaries that do not enter
into financing transactions) or when they need to be
adjusted to reflect the terms and conditions of the
lease (for example, when leases are not in the subsid-
iary’s functional currency). The Group estimates the
IBR using observable inputs (such as market interest
rates) when available and is required to make certain
entity-specific estimates (such as the subsidiary’s
stand-alone credit rating).

(i) Contingent liabilities

A contingent liability arises where a past event has
taken place for which the outcome will be confirmed
only by the occurrence or non-occurrence of one or
more uncertain events outside of the control of the
Group, or a present obligation exists but is not recog-
nised because it is not probable that an outflow of
resources will be required to settle the obligation.

A provision is made when a loss to the Group is likely
to crystallise. The assessment of the existence of a
contingency and its likely outcome, particularly if it
is considered that a provision might be necessary,
involves significant judgment taking all relevant
factors into account.

(j) Share-based compensation benefits

Share based compensation benefits are accounted
for in accordance with the fair value recognition
provisions of IFRS 2 “Share-based Payment”. As such,
share-based compensation expense for equity-settled
share-based payments is measured at the grant date
based on the fair value of the award and is recog-
nised as an expense over the vesting period. The fair
value of such share-based awards at the grant date is
measured using the Black Scholes pricing model. The
inputs used in the model are based on management’s
best estimates for the effects of non-transferability,
exercise restrictions, behavioural considerations and
expected volatility. Please refer to Note 23.

(k) Consolidation of Cobre San Rafael

Cobre San Rafael, S.L. is the entity which holds the
mining rights of Proyecto Touro. The Group controls
Cobre San Rafael, S.L. as it is exposed to variable returns
from its involvement with the subsidiary and has the
ability to affect those returns through its power over
the subsidiary. The control is proven as: one of the two

Directors belongs to the Group and management of
the financial books and the capacity to appoint the key
personnel is controlled by Atalaya.

(l) Classification of financial assets

Financial assets are classified, at initial recognition, and
subsequently measured at amortised cost, fair value
through OCI, or fair value through profit or loss.

The Group and Company exercises judgement upon
determining the classification of its financial assets
upon considering whether contractual features
including interest rate could significantly affect future
cash flows. Furthermore, judgment is required when
assessing whether compensation paid or received on
early termination of lending arrangements results in
cash flows that are not ‘solely payments of principal
and interest (SPPI).

(n) Determining the lease term of contracts with
renewal options

The Group determines the lease term as the non-can-
cellable term of the lease, together with any periods
covered by an option to extend the lease if it is reason-
ably certain to be exercised, or any periods covered
by an option to terminate the lease, if it is reasonably
certain not to be exercised.

The Group has the option, under some of its leases to
lease the assets for additional terms of three to five
years. The Group applies judgement in evaluating
whether it is reasonably certain to exercise the option
to renew. That is, it considers all relevant factors that
create an economic incentive for it to exercise the
renewal. After the commencement date, the Group
reassesses the lease term if there is a significant event
or change in circumstances that is within its control
and affects its ability to exercise (or not to exercise) the
option to renew (e.g., a change in business strategy).
The Group included the renewal period as part of
the lease term for leases of plant and machinery due
to the significance of these assets to its operations.
These leases have a short non-cancellable period
(i.e., three to five years) and there will be a significant
negative effect on production if a replacement is not
readily available. The renewal options for leases of
motor vehicles were not included as part of the lease
term because the Group has a policy of leasing motor
vehicles for not more than five years and hence not
exercising any renewal options.

Atalaya Mining Plc.

Notes to the Consolidated and Company Financial Statements

Consolidated and Company Financial Statements

137

4. Business and
geographical segments

Business segments

Geographical segments

The Group has only one distinct business segment,
that being mining operations, which include mineral
exploration and development.

Copper concentrates produced by the Group are sold
to three offtakers as per the relevant offtake agree-
ment (Note 30.3).

The Group’s mining activities are located in Spain.
The commercialisation of the copper concentrates
produced in Spain is carried out through Cyprus. Sales
transactions to related parties are on arm’s length basis
in a similar manner to transaction with third parties.
Accounting policies used by the Group in different
locations are the same as those contained in Note 2.

(Euro 000’s)

2022

Revenue – from external customers

Earnings/(loss)before Interest, Tax, Depreciation and Amortisation

Depreciation/amortisation charge

Net foreign exchange gain

Finance income

Finance cost

Profit/(loss) before tax

Tax

Profit/(loss) for the period

Total assets

Total liabilities

Depreciation of property, plant and equipment

Amortisation of intangible assets

Total net additions of non-current assets

2021

Revenue

Cyprus

Spain

Other

Total

30,662

19,714

331,184

35,867

(34,119)

5,368

(1)

25,117

(3,352)

21,765

6,178

588

(1,044)

7,470

1,958

9,428

361,846

(267)

55,314

(34,119)

11,546

624

(1,045)

32,320

(1,394)

30,926

108,486

528,829

25,756

663,071

(3,772)

(193,002)

29,637

4,482

74,695

40,827

364,890

(196,774)

29,637

4,482

74,695

405,717

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

Earnings/(loss)before Interest, Tax, Depreciation and Amortisation

30,284

168,880

(50)

199,114

Depreciation/amortisation charge

Net foreign exchange gain

Finance income

Finance cost

Profit/(loss) before tax

Tax

Profit for the year

Total assets

Total liabilities

Depreciation of property, plant and equipment

Amortisation of intangible assets

Total additions of non-current assets

(32,276)

2,301

4,285

(13,657)

32,585

127,289

(3,776)

(23,825)

28,809

103,464

77,750

506,523

(1,934)

(147,567)

27,680

4,596

41,040

(47)

1,134

(8)

(32,276)

6,589

(13,657)

159,827

(27,601)

132,226

585,407

(149,509)

27,680

4,596

41,040

Atalaya Mining Plc.

138

Consolidated and Company Financial Statements

Notes to the Consolidated and Company Financial Statements

Revenue represents the sales value of goods supplied
to customers; net of value added tax. The following
table summarises sales to customers with whom

transactions have individually exceeded 10.0% of the
Group’s revenues.

2022

2021

(Euro 000’s)

Segment

Offtaker 1

Offtaker 2

Offtaker 3

Copper

€’000

71,839

108,158

181,822

Segment

Copper

5. Revenue

The Group

(Euro 000’s)

Revenue from contracts with customers(1)

Fair value gain relating to provisional pricing within sales(2)

Total revenue

2022

371,303

(9,457)

361,846

€’000

130,642

91,651

173,904

2021

399,966

5,751

405,717

(1) Included within 2022 revenue there is a transaction price of €7.6 million (€2.8 million in 2021) related to the freight services provided by
the Group to the customers arising from the sales of copper concentrate under CIF incoterm.

(2) Provisional pricing impact represented the change in fair value of the embedded derivative arising on sales of concentrate.

All revenue from copper concentrate is recognised at a point in time when the control is transferred. Revenue from
freight services is recognised over time as the services are provided.

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

The Company

(Euro 000’s)

Sales of services to related companies (Note 30.3)

Dividends

Other income

2022

2,756

55,000

286

58,042

2021

1,849

64,000

65,849

Atalaya Mining Plc.

Notes to the Consolidated and Company Financial Statements

Consolidated and Company Financial Statements

139

6. Expenses by nature

The Group

(Euro 000’s)

Operating costs

Rents (Note 27)

Care and maintenance expenditure

Exploration expenses

Employee benefit expense (Note 7)

Compensation of key management personnel

Auditors’ remuneration – audit

Other accountants’ remuneration

Consultants’ remuneration

Depreciation of property, plant and equipment (Note 13)

Amortisation of intangible assets (Note 14)

Travel costs

Share option-based employee benefits

Shareholders’ communication expense

On-going listing costs

Legal costs

Public relations and communication development

Insurances

Other expenses and provisions

Total

The Company

(Euro 000’s)

Key management remuneration

Auditors’ remuneration – audit

Other accountants’ remuneration

Consultants’ remuneration

Management fees (Note 30.3)

Travel costs

Shareholders’ communication expense

On-going listing costs

Legal costs

Insurances

Other expenses and provisions

Total

Atalaya Mining Plc.

2022

2021

246,840

150,954

5,678

15,603

3,723

24,556

2,189

345

138

1,087

29,637

4,482

282

1,279

305

533

1,469

1,035

1,673

5,752

13,720

1,800

23,793

2,335

283

921

27,680

4,596

105

899

251

352

1,086

650

3,526

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

340,937

238,879

2022

2021

540

139

224

305

533

1,258

393

3,600

547

146

222

251

352

667

2,422

140

Consolidated and Company Financial Statements

Notes to the Consolidated and Company Financial Statements

7. Employee benefit expense

The Group

(Euro 000’s)

Wages and salaries

Social security and social contributions

Employees’ other allowances

Bonus to employees

2022

18,438

5,659

443

24,556

The average number of employees and the number of employees at year end by office are:

Number of employees

Spain – Full time

Spain – Part time

Cyprus – Full time

Cyprus – Part time

Total

The Company

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

Average

At year end

2022

473

480

2021

406

500

2022

462

468

2021

17,652

5,583

541

23,793

2021

422

506

The company had no employees during the year ended 31 December 2022 and 2021.

8. Finance income

The Group

(Euro 000’s)

Interest income

Unwinding of discount on mine rehabilitation provision (Note 26)

The Company

(Euro 000’s)

Interest income from interest-bearing intercompany loans at fair value through profit and loss (Note 30.3)

Interest income from interest-bearing intercompany loans at amortised cost (Note 30.3)

Other interest income

Interest income relates to interest received on bank balances.

Atalaya Mining Plc.

2022

2021

244

380

624

2022

2021

9,157

3,743

12,936

12,854

2,398

15,252

Notes to the Consolidated and Company Financial Statements

Consolidated and Company Financial Statements

141

9. Finance costs

The Group

(Euro 000’s)

Interest expense:

Other interest

Interest expense on lease liabilities

Other finance expenses

Unwinding of discount on mine rehabilitation provision (Note 26)

Other finance expense is related to the interest calculation proposed by Astor.

10. Tax

The Group

(Euro 000’s)

Current income tax charge

Deferred tax related to utilization of losses for the year (Note 17)

Deferred tax income relating to the origination of temporary differences (Note 17)

Deferred tax expense relating to reversal of temporary differences (Note 17)

2022

2021

1,025

1,045

2022

3,123

(4,544)

2,815

1,394

846

11,737

1,063

13,657

2021

24,359

3,856

(2,986)

2,372

27,601

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

The tax on the Group’s results before tax differs from the theoretical amount that would arise using the applicable
tax rates as follows:

The Group

(Euro 000’s)

Accounting profit before tax

Tax calculated at the applicable tax rates of the Company – 12.5%

Tax effect of expenses not deductible for tax purposes

Tax effect of tax loss for the year

Tax effect of allowances and income not subject to tax

Effect of higher tax rates in other jurisdictions of the group

Tax effect of tax losses brought forward

Deferred tax (Note 17)

Tax charge

The Company

(Euro 000’s)

Current income tax charge

Atalaya Mining Plc.

2022

2021

32,318

4,040

1,029

3,819

(7,857)

2,092

(1,729)

1,394

2022

617

159,827

19,978

2,743

359

(2,629)

7,764

(3,856)

3,242

27,601

2021

862

142

Consolidated and Company Financial Statements

Notes to the Consolidated and Company Financial Statements

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

Tax losses carried forward

As at 31 December 2022, the Group had tax losses
carried forward amounting to €0.2 million from the
Spanish subsidiaries for the period 2008 to 2015 and
€4.1 million for the period 2022.

Cyprus

The corporation tax rate is 12.5%. Under certain
conditions interest income may be subject to
defence contribution at the rate of 30%. In such
cases this interest will be exempt from corpo-
ration tax. In certain cases, dividends received
from abroad may be subject to defence
contribution at the rate of 17% for 2014 and
thereafter. Under current legislation, tax losses
may be carried forward and be set off against
taxable income of the five succeeding years.

Companies which do not distribute 70% of
their profits after tax, as defined by the rele-
vant tax law, within two years after the end of
the relevant tax year, will be deemed to have
distributed as dividends 70% of these profits.
Special contribution for defence at 20% for the
tax years 2012 and 2013 and 17% for 2014 and
thereafter will be payable on such deemed
dividends to the extent that the shareholders
(companies and individuals) are Cyprus tax
residents and Cyprus domiciled. The amount
of deemed distribution is reduced by any
actual dividends paid out of the profits of the
relevant year at any time. This special contribu-
tion for defence is payable by the Company for
the account of the shareholders.

Spain

The corporation tax rate for 2022 and 2021
is 25%. The Spanish tax reform approved in
2014 reduced the general corporation tax rate
from 30% to 28% in 2015 and to 25% in 2016,
and introduced, among other changes, a 10%
reduction in the tax base subject to equity
increase and other requirements. Under
current legislation, tax losses may be carried
forward and be set off against taxable income
with no limitation.

11. Earnings per share

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

(Euro 000’s)

2022

2021

Parent company

Subsidiaries

Profit attributable to equity holders of
the parent

Weighted number of ordinary shares
for the purposes of basic earnings per
share (‘000)

(676)

(1,773)

33,831

135,417

33,155

133,644

139,757

138,196

Basic profit per share (EUR cents/share)

23.7

96.7

Weighted number of ordinary shares
for the purposes of diluted earnings per
share (‘000)

142,834

141,526

Diluted profit per share (EUR cents/
share)

23.2

94.4

At 31 December 2022, there are 3,543,500 options
(Note 23) and nil warrants (Note 22) (At 31 December
2021: 3,841,750 options and nil warrants) which have
been included when calculating the weighted average
number of shares for FY2022.

12. Dividends paid

Cash dividends declared and paid during the year:

(Euro 000’s)

31 Dec
2022

31 Dec
2021

Inaugural dividend

47,290

Interim dividend declared and paid

5,099

Total cash dividends paid in the year to
ordinary shareholders

5,099

47,290

Fully paid ordinary shares carry one vote per share and
carry the right to dividends.

Dividend Policy

Following the expansion of Proyecto Riotinto’s
processing capacity to 15 Mtpa, Atalaya has been
generating robust cash flow as a result of the plant
consistently operating above nameplate capacity,
coupled with the strong copper price environment.

Accordingly, on 27 October 2021, Atalaya initiated
a sustainable dividend policy that will allow for

Atalaya Mining Plc.

Notes to the Consolidated and Company Financial Statements

Consolidated and Company Financial Statements

143

continued investments in its portfolio of low capital
intensity growth projects, such as the San Dionisio
deposit, Proyecto Masa Valverde and Proyecto Touro.

Consistent with its strategy to create and deliver share-
holder value, the Company approved a Dividend Policy
that will make an annual pay-out of between 30% and
50% of free cash flow generated during the applicable
financial year.

The Dividend Policy took effect during the 2022
financial year. The annual Ordinary Dividend will be
paid in two half-yearly instalments and announced in
conjunction with interim and full year results.

The declaration and payment of all future dividends
under the new policy will remain subject to approval
by the Board of Directors.

13. Property, plant and equipment

Land and
buildings

Right
of use
assets(5)

Plant and
equipment

Assets
under
construc-
tion(3)

Deferred
mining
costs(2)

Other
assets(1)

Total

(Euro 000’s)

2022

Cost

At 1 January 2022

Additions

Increase in rehab. provision

Reclassifications(4)

Advances

Write-off

At 31 December 2022

Depreciation

At 1 January 2022

Charge for the year

At 31 December 2022

Net book value at 31 December 2022

2021

Cost

At 1 January 2021

Additions

Increase in rehab. provision

Reclassifications

Advances

2,383

1,727

15,300

103

(4,190)

80,326

16,026

4,428

20,454

59,872

65,003

7,076

283,346

1,262

22,860

49,473

6,727

(22,098)

51,667

691

801

430,753

53,809

1,727

103

(4,190)

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

7,076

291,335

50,235

52,358

872

482,202

1,546

452

1,998

5,078

67,991

21,191

89,182

11,380

3,541

14,921

202,153

50,235

37,437

64,034

6,569

268,051

270

655

507

1,941

15,828

20,386

13,354

(13,354)

41,868

9,799

714

739

133

801

97,657

29,637

127,294

354,908

397,151

32,903

655

At 31 December 2021

65,003

7,076

283,346

22,860

51,667

801

430,753

Depreciation

At 1 January 2021

Charge for the year

At 31 December 2021

Net book value at 31 December 2021

11,671

4,355

16,026

48,977

956

590

1,546

5,530

48,134

19,857

67,991

8,528

2,852

11,380

215,355

22,860

40,287

688

714

69,977

27,680

97,657

333,096

(1) Includes motor vehicles, furniture, fixtures and office equipment which are depreciated over 5-10 years.
(2) Stripping costs
(3) Assets under construction at 31 December 2022 amounted to €50.2 million (2021: €22.9 million). It includes the capitalisation of costs
related sustaining capital expenses (€6.3 million), tailing dams (€14.1 million) and solar plant (€22.8m).
(4) Transfers related to sustaining Capex (€6.8 million) and the Tailing Dam Project (€15.3 million) which were finalised works.
(5) See leases in Note 27.

Atalaya Mining Plc.

144

Consolidated and Company Financial Statements

Notes to the Consolidated and Company Financial Statements

The Group

The above fixed assets are mainly located in Spain.

The Company

(Euro 000’s)

2022

Cost

At 1 January 2022

At 31 December 2022

Depreciation

At 1 January 2022

Charge for the year

At 31 December 2022

Net book value at 31 December 2022

2021

Cost

At 1 January 2021

At 31 December 2021

Depreciation

At 1 January 2021

Charge for the year

At 31 December 2021

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

Net book value at 31 December 2021

(1) Includes furniture, fixtures and office equipment which were depreciated over 5-10 years.

14. Intangible assets

The Group

(Euro 000’s)

2022

Cost

On 1 January 2022

Additions

At 31 December 2022

Amortisation

On 1 January 2022

Charge for the year

At 31 December 2022

Net book value at 31 December 2022

Permits (1)

Licences, R&D and
Software

8,595

8,642

8,371

8,440

202

80,358

897

81,255

23,214

4,413

27,627

53,628

Atalaya Mining Plc.

Other assets(1)

Total

88,953

944

89,897

31,585

4,482

36,067

53,830

Notes to the Consolidated and Company Financial Statements

Consolidated and Company Financial Statements

145

(Euro 000’s)

2021

Cost

On 1 January 2021

Additions

At 31 December 2021

Amortisation

On 1 January 2021

Charge for the year

At 31 December 2021

Net book value at 31 December 2021

Permits (1)

Licences, R&D and
Software

78,210

2,148

80,358

18,683

4,531

23,214

57,144

8,595

8,306

8,371

224

Total

86,805

2,148

88,953

26,989

4,596

31,585

57,368

(1) Permits include the mining rights of Proyecto Touro, Masa Valverde and Ossa Morena

The ultimate recovery of balances carried forward in relation to areas of interest or all such assets including intangi-
bles is dependent on successful development, and commercial exploitation, or alternatively the sale of the respec-
tive areas.

The Group conducts impairment testing in case there is an indicator of impairment. Atalaya assessed its assets
concluding that there are no indicators of impairment for either Proyecto Riotinto or any other as of 31 December
2022.

15. Investment in subsidiaries

The Company

(Euro 000’s)

Opening amount at cost minus provision for impairment

Increase of investment(2)

Closing amount at cost less provision for impairment

2022

2021

64,171

10,739

74,910

5,448

58,723

64,171

The directly owned subsidiaries of the Group, the percentage of equity owned and the main country of operation
are set out below. These interests are consolidated within these financial statements.

Subsidiary companies

Date of
incorporation/
acquisition

Principal
activity

Country of
incorporation

Effective
proportion of
shares held in
2022(3)

Effective
proportion of
shares held in
2021(3)

Atalaya Touro (UK) Ltd

10 March 2017

Holding

United Kingdom

Atalaya Minasderiotinto Project (UK) Ltd(1)

10 Sep 2008

Holding

United Kingdom

EMED Marketing Ltd

08 Sep 2008

Trading

EMED Mining Spain SLU(2)

12 April 2007

Exploration

Atalaya Financing Ltd

16 Sep 2020

Financing

Cyprus

Spain

Cyprus

100%

(1) The increase of €10.8 million related to a share capital increase of Atalaya Minasderiotinto Project (UK) Ltd. amounting to €9.5 million and
share-based payment expense of €1.3 million (2021: €0.9 million).
(2) EMED Mining Spain, S.L. was disposed on 4 January 2022
(3) The effective proportion of shares held as at 31 December 2022 and 2021 remained unchanged.

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

Atalaya Mining Plc.

146

Consolidated and Company Financial Statements

Notes to the Consolidated and Company Financial Statements

16. Investment in joint venture

Company name

Principal activities

Country of incorporation

Effective proportion of shares
held at 31 December 2015

Recursos Cuenca Minera S.L.

Exploitation of tailing dams and
waste areas resources

Spain

50%

In 2012 Atalaya Riotinto Minera, S.L.U. entered into a 50/50 joint venture with Rumbo to evaluate and exploit the
potential of the class B resources in the tailings dam and waste areas at The Proyecto Riotinto. Under the joint
venture agreement, ARM will be the operator of the joint venture and will reimburse Rumbo for the costs asso-
ciated with the application for classification of the Class B resources. Atalaya Riotinto Minera will fund the initial
expenditure of a feasibility study up to a maximum of €2.0 million. Costs are then borne by the joint venture part-
ners in accordance with their respective ownership interests.

The Group’s significant aggregate amounts in respect of the joint venture are as follows:

(Euro 000’s)

Intangible assets

Trade and other receivables

Cash and cash equivalents

Trade and other payables

Net assets

Revenue

Expenses

Net profit/(loss) after tax

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

17. Deferred tax

(Euro 000’s)

The Group

Deferred tax asset

At 1 January

Deferred tax related to utilization of losses for the year (Note 10)

Deferred tax income relating to the origination of temporary differences (Note 10)

Deferred tax expense relating to reversal of temporary differences (Note 10)

At 31 December

Deferred tax (expense)/income (Note 10)

2022

(115)

2021

(115)

Consolidated statement
of financial position

Consolidated income
statement

2022

2021

2022

2021

5,564

4,544

(2,815)

7,293

8,805

(3,856)

2,986

(2,371)

5,564

(4,544)

2,815

3,856

(2,986)

2,371

(1,729)

3,241

Deferred tax assets are recognised for the carry-forward of unused tax losses and unused tax credits to the extent
that it is probable that taxable profits will be available in the future against which the unused tax losses/credits
can be utilised. The Company held tax losses amounted to €4.4 million in Spain.

Atalaya Mining Plc.

Notes to the Consolidated and Company Financial Statements

Consolidated and Company Financial Statements

147

18. Inventories

The Group

(Euro 000’s)

Finished products

Materials and supplies

Work in progress

As at 31 December 2022, copper concentrate
produced and not sold amounted to 3,529 tonnes
(FY2021: 5,254 tonnes). Accordingly, the inventory for
copper concentrate was €4.5 million (FY2021: €5.2
million). During the year 2022 the Group recorded cost
of sales amounting to €289.0 million (FY2021: €192.1
million).

Materials and supplies relate mainly to machinery
spare parts. Work in progress represents ore stock-
piles, which is ore that has been extracted and is
available for further processing.

2022

2021

4,547

31,330

2,964

5,185

18,216

1,380

38,841

24,781

19. Trade and other receivables

(Euro 000’s)

The Group

Non-current trade and other receivables

Deposits

Loans

Other non-current receivables

Current trade and other receivables

Trade receivables at fair value – subject to provisional pricing

Trade receivables from shareholders at fair value – subject to provisional pricing (Note 30.5)

Other receivables from related parties at amortised cost (Note 30.3)

Deposits

VAT receivable

Tax advances

Prepayments

Other current assets

Allowance for expected credit losses

Total trade and other receivables

The Company

Non-current trade and other receivables

Receivables from own subsidiaries at amortised cost (Note 30.4)

Receivables from own subsidiaries at fair value through profit and loss (Note 30.4)

Current trade and other receivables

Tax advances CIT

Receivables from own subsidiaries at amortised cost (Note 30.4)

Other receivables

Total current trade and other receivables

Atalaya Mining Plc.

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

2022

2021

256

12,865

3,241

16,362

14,757

12,800

28,856

5,845

1,795

64,155

80,517

245,657

14,247

259,904

48,774

48,831

303

2,332

2,695

5,330

8,865

20,283

17,300

3,303

300

50,128

55,458

69,452

176,292

245,744

279

2,084

2,415

148

Consolidated and Company Financial Statements

Notes to the Consolidated and Company Financial Statements

Trade receivables are shown net of any interest applied
to prepayments. Payment terms are aligned with
offtake agreements and market standards and gener-
ally are 7 days on 90% of the invoice and the remaining
10% at the settlement date which can vary between 1 to
5 months. The fair value of trade and other receivables
approximate their book values.

Non-current deposits included €250k (YTD 2021:
€250k) as a collateral for bank guarantees, which was
recorded as restricted cash (or deposit). Restricted cash
related to the collateral was reclassified to non-current

trade and other receivables since the deposit is consid-
ered to be long term.

Loans are related to an agreement entered by the
Group and Lain Technologies Ltd in relation to the
construction of the pilot plan to develop the E-LIX
System. The Loan is secured with the pilot plant, has a
grace period of up to four years and repayment terms
depending on future investments on the system.
Amounts drawn down bear interest at 2%. The increase
is resulted from the drawdowns withdraw required for
the pilot plant construction.

20. Other Financial assets at FVOCI

The Group

(Euro 000’s)

Financial asset at fair value through OCI (see (a)) below)

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

Total current

Total non-current

The Company

(Euro 000’s)

Financial asset at fair value through OCI (see (a)) below)

Total current

a) Financial assets at fair value through OCI

The Group

(Euro 000’s)

At 1 January (1)

Fair value change recorded in equity (Note 23)

At 31 December

The Company

(Euro 000’s)

At 1 January (1)

Fair value change recorded in equity (Note 23)

At 31 December

2022

1,134

1,101

2022

1,140

(6)

1,134

2022

(6)

2021

1,140

1,101

2021

1,187

(47)

1,140

2021

(47)

(1) The Group decided to recognise changes in the fair value through other comprehensive income (‘OCI’), as explained in Note 2.12.

Atalaya Mining Plc.

Notes to the Consolidated and Company Financial Statements

Consolidated and Company Financial Statements

149

Company name

Principal activities

Country of incorporation

Effective proportion of shares
held at 31 December 2022

Explotaciones Gallegas del Cobre SL

Exploration company

KEFI Minerals Plc

Exploration and development
mining company listed on AIM

Spain

Prospech Limited

Exploration company

Australia

12.5%

0.19%

0.53%

21. Cash and cash equivalents

The Group

(Euro 000’s)

Unrestricted cash and cash equivalents at Group level

Unrestricted cash and cash equivalents at Operation level

Restricted cash and cash equivalents at Operation level

Consolidated cash and cash equivalents

31 Dec 2022

31 Dec 2021

108,550

17,567

331

126,448

48,375

43,722

15,420

107,517

As at 31 December 2022, the Group’s operating subsidiary held restricted cash of €0.3 million of a provision for legal
costs related to Astor.

Cash and cash equivalents denominated in the following currencies:

(Euro 000’s)

2022

2021

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

Euro – functional and presentation currency

» Great Britain Pound

» United States Dollar

The Company

(Euro 000’s)

Cash at bank and on hand

84,146

895

41,407

126,448

30,145

77,336

107,517

2022

2021

39,472

37,270

Cash and cash equivalents denominated in the following currencies:

(Euro 000’s)

2022

2021

Euro – functional and presentation currency

» Great Britain Pound

» United States Dollar

38,496

879

39,472

37,212

37,270

Atalaya Mining Plc.

150

Consolidated and Company Financial Statements

Notes to the Consolidated and Company Financial Statements

22. Share capital

Authorised

Nr. of Shares
’000’s

Share capital
£ 000’s

Share Premium
£ 000’s

Ordinary shares of £0.075 each

200,000

15,000

Total
£ 000’s

15,000

Issued and fully paid

1 January 2021

Issue Date

Price (£)

Details

12-Feb-21

18-May-21

15 Dec 2021

2.015

Exercised share options(c)

2.015

Exercised share options(d)

1.475

Exercised share options(d)

1.475

Exercised share options(e)

2.015

Exercised share options(e)

000’s

138,141

Euro 000’s

13,439

315,714

329,153

31 December 2021 / 1 January 2022

138,236

13,447

315,916

329,363

22 Jan 2022

1.44

Exercised share options(b)

2.015

Exercised share options(b)

2.045

Exercised share options(b)

1.475

Exercised share options(b)

3.09

Exercised share options(b)

23 June 2022

1.475

Exercised share options(a)

314

321

400

451

135

512

746

941

754

505

540

775

977

796

517

31 December 2022

139,880

13,596

319,411

333,007

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

The Company´s share capital at 31 December 2022 is
139,879,209 ordinary shares (138,235,959 in 2021) of Stg
£0.075 each.

Authorised capital

The Company’s authorised share capital is
200,000,000 ordinary shares of £0.075 each.

Issued capital

(a) On 23 June 2022, the Company announced that
it has issued 22,500 ordinary shares of 7.5p in the
Company (“Option Shares”) pursuant to an exercise of
share options by an employee.

(b) On 26 January 2022, the Company announced
that is was notified that PDMRs exercised a total of
1,350,000 options. Further details (including details of

sales of shares following the exercise of options) are
given in Note 23.

(c) On 12 February 2021, the Company was notified that
certain employees exercised options over 40,750 ordi-
nary shares of £0.075 at a price of £2.015, thus creating
a share premium of €91k.

(d) On 18 May 2021, the Company was notified that
certain employees exercised options over 30,000 ordi-
nary shares of £0.075 at a price between £1.475 and
£2.015, thus creating a share premium of €61k.

(e) On 15 December 2021, the Company was notified
that certain employees exercised options over 24,500
ordinary shares of £0.075 at a price between £1.475
and £2.015, thus creating a share premium of €50k.

Details of share options outstanding as at 31 December
2022:

Grant date

Expiry date

Exercise price £

Share options

29 May 2019

30 June 2020

24 June 2021

26 January 2022

22 June 2022

Total

28 May 2024

29 June 2030

23 June 2031

25 January 2032

30 June 2027

At 1 January 2022

Granted options during the year

Options executed during the year

31 December 2022

2.015

1.475

3.090

4.160

3.575

666,500

516,000

1,016,000

120,000

1,225,000

3,543,500

Weighted average
exercise price £

Share options

2.154

3.627

1.844

2.857

3,841,750

1,345,000

(1,643,250)

3,543,500

Atalaya Mining Plc.

Notes to the Consolidated and Company Financial Statements

Consolidated and Company Financial Statements

151

23. Other reserves

The Group

(Euro 000’s)

At 1 January 2021

Recognition of depletion factor

Recognition of non-distributable reserve

Recognition of distributable reserve

Recognition of share based payments

Change in fair value of financial assets at fair value through
OCI (Note 20)

Other changes in reserves

At 31 December 2021

Recognition of depletion factor

Recognition of non-distributable reserve

Recognition of distributable reserve

Recognition of share based payments

Change in fair value of financial assets at fair value through
OCI (Note 20)

Other changes in reserves

At 31 December 2022

The Company

n
o

i
t
p
o
e
r
a
h
S

e
r
a
h
s

s
u
n
o
B

n
o

i
t
e
p
e
D

)
1
(

r
o
t
c
a
f

e
v
r
e
s
e
r
V
F

i
c
n
a
n

i
f

f
o

t
a
s
t
e
s
s
a

)
2
(

C
O
V
F

-
t
u
b
i
r
t
s
i
d
-
n
o
N

)
3
(

e
v
r
e
s
e
r
e
b
a

e
b
a
t
u
b
i
r
t
s
i
D

)
4
(
e
v
r
e
s
e
r

a
t
o
T

8,187

208

25,033

(1,100)

5,628

2,093

40,049

899

(55)

(47)

6,155

2,372

3,317

6,100

2,372

3,317

899

(47)

9,086

208

24,978

(1,147)

8,000

11,565

52,690

1,279

12,800

(6)

316

12,800

316

2,726

1,279

(6)

10,365

208

37,778

(1,153)

8,316

14,291

69,805

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

(Euro 000’s)

At 1 January 2021

Adjustment for initial application of IFRS 9

Recognition of share based payments

Change in fair value of financial assets at fair value through OCI (Note 20)

At 31 December 2021

Recognition of share based payments

Change in fair value of financial assets at fair value through OCI (Note 20)

At 31 December 2022

Share option

Bonus share

Fair value
reserve of
financial
assets at
FVOCI (2)

8,187

899

9,086

1,278

10,364

208

(1,100)

208

(47)

(1,147)

(6)

208

(1,153)

Total

7,295

899

(47)

8,147

1,278

(6)

9,419

(1) Depletion factor reserve: During the twelve month period ended 31 December 2022, the Group has increase €12.8 million (FY2021: disposal of
€6.1 million) as a depletion factor reserve as per the Spanish Corporate Tax Act.

(2) Fair value reserve of financial assets at FVOCI: The Group decided to recognise changes in the fair value of certain investments in equity
securities in OCI. These changes are accumulated within the FVOCI reserve under equity. The Group transfers amounts from this reserve to
retained earnings when the relevant equity securities are derecognised.

(3) Non-distributable reserve: As required by the Spanish Corporate Tax Act, the Group classified a non-distributable reserve of 10% of the profits
generated by the Spanish subsidiaries until the reserve is 20% of share capital of the subsidiary.

(4) Distributable reserve: As result of the 2018 profit generated in Atalaya Riotinto Minera, S.L.U., the Group decided to record a distributable
reserve in order to comply with the Spanish Corporate Tax Act.

Atalaya Mining Plc.

152

Consolidated and Company Financial Statements

Notes to the Consolidated and Company Financial Statements

In general, option agreements contain provisions
adjusting the exercise price in certain circumstances
including the allotment of fully paid ordinary shares
by way of a capitalisation of the Company’s reserves,
a subdivision or consolidation of the ordinary shares,
a reduction of share capital and offers or invitations

(whether by way of rights issue or otherwise) to the
holders of ordinary shares.

The estimated fair values of the options were calcu-
lated using the Black Scholes option pricing model. The
inputs into the model and the results are as follows:

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

Grant Date

23 Feb 2017

29 May 2019

8 July 2019

30 June 2020

23 June 2021

26 January 2022

22 June 2022

Weighted
average
share price
£

Weighted
average
exercise
price £

Expected
volatility

Expected
life (years)

Risk Free
rate

Expected
dividend
yield

Estimated
Fair Value £

1.440

2.015

2.045

1.475

3.090

4.160

3.575

1.440

2.015

2.045

1.475

3.090

4.160

3.575

51.80%

46.90%

50.32%

50.91%

49.18%

34.12%

0.6%

0.8%

0.3%

0.7%

1.149%

2.748%

Nil

0.666

0.66

0.60

0.81

1.12

0.71

The volatility has been estimated based on the underlying volatility of the price of the Company’s shares in the
preceding twelve months.

24. Non-controlling interest

(Euro 000’s)

Opening balance

On acquisition of a subsidiary

Share of total comprehensive income for the year

Closing balance

31 Dec 2022

31 Dec 2021

(4,909)

140

(2,229)

(6,998)

(3,491)

(1,418)

(4,909)

The Group has a 10% interest in Cobre San Rafael, S.L. acquired in July 2017 while the remaining 90% is held by a
non-controlling interest (Note 2.3 (b) (1)). The significant financial information with respect to the subsidiary before
intercompany eliminations as at and for the twelve month period ended 31 December 2022 is as follows:

(Euro 000’s)

Non-current assets

Current assets

Non-current liabilities

Current liabilities

Equity

Revenue

Loss for the year and total comprehensive income

Cobre San Rafael, S.L. was established on 13 June 2016.

* 10% interest in Cobre San Rafael, S.L. was acquired by the Group in July 2017.

Atalaya Mining Plc.

31 Dec 2022

31 Dec 2021

6,976

551

14,478

824

(7,776)

(2,477)

5,155

315

9,481

(5,299)

(1,420)

Notes to the Consolidated and Company Financial Statements

Consolidated and Company Financial Statements

153

25. Trade and other payables

The Group

(Euro 000’s)

Non-current trade and other payables

Other non-current payables

Government grant

Current trade and other payables

Trade payables

Accruals

VAT payable

Other

The Company

Non-current trade and other payables

Suppliers

Accruals

Payable to own subsidiaries (Note 30.4)

VAT payable

31 Dec 2022

31 Dec 2021

2,000

2,015

85,038

3,322

259

1,403

90,022

284

1,034

3,825

259

5,402

3,435

3,450

49,712

16,267

138

66,191

1,259

634

2,014

Other non-current payables are related with the acqui-
sition of Atalaya Masa Valverde formerly Cambridge
Minería España, SL and Atalaya Ossa Morena formerly
Rio Narcea Nickel, SL (see Note 29).

Trade payables are mainly for the acquisition of
materials, supplies and other services. These payables
do not accrue interest and no guarantees have been

granted. The fair value of trade and other payables
approximate their book values.

The Group’s exposure to currency and liquidity risk
related to liabilities is disclosed in Note 3.

Trade payables are non-interest-bearing and are
normally settled on 60-day terms.

26. Provisions

(Euro 000’s)

At 1 January 2021

Additions

Used of provision

Reversal of provision

Finance cost (Note 9)

At 31 December 2021

Additions

Reclassification

Used of provision

Reversal of provision

Finance income (Note 9)

At 31 December 2022

Other provisions

Legal costs

Rehabilitation costs

Total costs

24,638

655

(57)

1,063

26,299

1,033

(81)

(3,497)

(380)

23,374

25,264

681

(343)

(87)

1,063

26,578

1,063

1,435

(91)

(3,570)

(380)

25,035

626

(286)

(87)

279

(10)

(73)

226

1,435

Atalaya Mining Plc.

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

154

Consolidated and Company Financial Statements

Notes to the Consolidated and Company Financial Statements

(Euro 000’s)

31 Dec 2022

31 Dec 2021

Non-Current

Current

Total

24,083

952

25,035

26,578

Rehabilitation provision

Rehabilitation provision represents the estimated cost
required for adequate restoration and rehabilitation
upon the completion of production activities. These
amounts will be settled when rehabilitation is under-
taken, generally over the project’s life.

During 2020, Management engaged an independent
consultant to review and update the rehabilita-
tion liability. The updated estimation includes the
expanded capacity of the plant and its impact on the
mining project.

The discount rate used in the calculation of the net
present value of the liability as at 31 December 2022
was 3.41% (2021: 1.12%), which is the 15-year Spain
Government Bond rate for 2022. An inflation rate of
1%-5.70% (2021: 1%-1.96%) is applied on annual basis.

In June 2021, the Company announced a new inde-
pendent reserve estimate for Cerro Colorado open pit

at Proyecto Riotinto. Cerro Colorado open pit reserve
of 186 Mt at 0.38% and the life of mine over 12 years.

The expected payments for the rehabilitation work are
as follows:

(Euro 000 ’s)

Between
1 – 5 Years

Between
6 – 10 Years

More than
10 years

Expected payments
for rehabilitation of the
mining site, discounted

7,843

2,685

12,846

Legal provision

The Group has been named as defendant in several
legal actions in Spain, the outcome of which is not
determinable as at 31 December 2022. Management
has reviewed individually each case and made a provi-
sion of €226k (€279k in 2021) for these claims, which
has been reflected in these consolidated financial
statements.

Other provisions

Other provisions are related with the called-up equity
holdings of Atalaya Masa Valverde S.L.

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

27. Leases

(Euro 000’s)

Non-current

Leases

Current

Leases

31 Dec 2022

31 Dec 2021

4,378

536

4,913

597

The Group entered into lease arrangements for the
renting of land, laboratory equipment, a building
and vehicles which are subject to the adoption of all
requirements of IFRS 16 Leases (Note 2.2). The Group
has elected not to recognise right-of-use assets and
lease liabilities for short-term leases that have a lease
term of 12 months or less and leases of low-value assets.

Amounts recognised in the statement of
financial position and profit or loss

Set out below are the carrying amounts of the Group’s
right-of-use assets and lease liabilities and the move-
ments during the period:

Atalaya Mining Plc.

Notes to the Consolidated and Company Financial Statements

Consolidated and Company Financial Statements

155

(Euro 000’s)

As at 1 January 2022

Additions

Depreciation expense

Interest expense

Payments

As at 31 December 2022

Right – of-use assets

Lands and
buildings

Vehicles

Laboratory
equipment

Total

Lease liabilities

5,417

(369)

5,048

(14)

(69)

5,530

(452)

5,078

5,510

(616)

4,914

The amounts recognised in profit or loss, are set out below:

(Euro 000’s)

Twelve month ended 31 Dec 2022

Twelve month ended 31 Dec 2021

As at 31 December

Depreciation expense of right-of-use assets

Interest expense on lease liabilities

Total amounts recognised in profit or loss

(452)

(20)

(472)

(590)

(11)

(601)

The Group recognised rent expense from short-term
leases (Note 6).

1.5%. At 31 December 2022, the remaining term of this
lease is eleven years. (Note 2)

Depreciation expense regarding leases amounts to
€0.5 million (2021: €0.6) for the twelve month period
ended 31 December 2022.

The duration of the land and building lease is for a
period of twelve years. Payments are due at the begin-
ning of the month escalating annually on average by

The duration of the motor vehicle and laboratory
equipment lease is for a period of four years, payments
are due at the beginning of the month escalating
annually on average by 1.5%. At 31 December 2022, the
remaining term of laboratory equipment lease is a half
year.

(Euro 000’s)

31 Dec 2022

31 Dec 2021

Minimum lease payments due:

» Within one year

» Two to five years

» Over five years

Less future finance charges

Present value of minimum lease payments due

Present value of minimum lease payments due:

» Within one year

» Two to five years

» Over five years

536

1,957

2,421

4,914

536

1,957

2,421

4,914

597

2,014

2,899

5,510

597

2,014

2,899

5,510

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

Atalaya Mining Plc.

156

Consolidated and Company Financial Statements

Notes to the Consolidated and Company Financial Statements

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

(Euro 000’s)

Balance 1 January 2022

Additions

Interest expense

Lease payments

Balance at 31 Dec 2022

» Non-current liabilities

» Current liabilities

28. Borrowings

(Euro 000’s)

Non-current borrowings

Credit facilities

Current borrowings

Credit facilities

Lease liability

5,510

(616)

4,914

4,378

536

4,914

31 Dec 2022

31 Dec 2021

20,768

52,595

34,050

13,394

The Group had uncommitted credit facilities totalling €119.3 million (€111.0 million at 31 December 2021). During
2022, Atalaya drawn down some of its existing credit facilities to financing the construction of 50 MW solar plant
(payable amount of €19.5 million at 31 December 2022) and in 2021 to pay the Deferred Consideration. Interest rates
for existing credit facilities, including facilities used to pay the Deferred Consideration, range from 1.10% to 2.45%
and the average interest rate on all facilities used and unused is 1.69%. The maximum term of the facilities is six
years. All borrowings are unsecured.

At 31 December 2022, the Group had used €73.4 million of its facilities and had undrawn facilities of €46.0 million.

29. Acquisition, incorporation and disposals of subsidiaries

2022

2021

Acquisition and incorporation of subsidiaries

On 31 January 2022, Atalaya established a new entity,
Iberian Polimetal S.L.U.

Disposals of subsidiaries

On 4 January 2022, the subsidiary EMED Mining Spain,
S.L. was wound up.

On 21 December 2021 Atalaya announced the acquisi-
tion of a 51% interest in Río Narcea Nickel, S.L., which
owns 17 investigation permits.

Disposals of subsidiaries

There were no disposals of subsidiaries during the year.

Wind-up of subsidiaries

There were no operations wound-up during the year.

Atalaya Mining Plc.

Notes to the Consolidated and Company Financial Statements

Consolidated and Company Financial Statements

157

30. Group information and related party disclosures

30.1 Information about subsidiaries

These audited consolidated financial statements include:

Subsidiary companies

Parent

Principal
activity

Country of
incorporation

Effective proportion
of shares held

Atalaya Touro (UK) Ltd

Atalaya Mining Plc

Holding

United Kingdom

Atalaya Financing Limited

Atalaya Mining Plc

Financing

Cyprus

Atalaya MinasdeRiotinto Project (UK) Limited

Atalaya Mining Plc

Holding

United Kingdom

EMED Marketing Ltd

Atalaya Mining Plc

Trading

Cyprus

Atalaya Riotinto Minera, S.L.U.

Atalaya MinasdeRiotinto Project
(UK) Limited

Production

Spain

Eastern Mediterranean Exploration and
Development S.L.U.

Atalaya MinasdeRiotinto Project
(UK) Limited

Dormant

Cobre San Rafael, S.L. (1)

Atalaya Touro (UK) Limited

Exploration

Recursos Cuenca Minera S.L.U.

Atalaya Riotinto Minera, S.L.U.

Dormant

Fundacion Atalaya Riotinto Minera

Atalaya Riotinto Minera, S.L.U.

Trust

Atalaya Servicios Mineros, S.L.U.

Atalaya MinasdeRiotinto Project
(UK) Limited

Holding

Atalaya Masa Valverde S.L.U. (2)

Atalaya Servicios Mineros, S.L.U.

Exploration

Atalaya Ossa Morena S.L. (3)

Atalaya Servicios Mineros, S.L.U.

Exploration

Iberian Polimetal S.L.U.

Atalaya Servicios Mineros, S.L.U.

Dormant

Spain

100%

10%

J-V

100%

99.9%

100%

(1) Cobre San Rafael, S.L. is the entity which holds the mining rights of Proyecto Touro. The Group has control in the management of Cobre
San Rafael, S.L., including one of the two Directors, management of the financial books and the capacity of appointment the key personnel
(Note 2.3 (b) (1)).

(2) Cambridge Mineria Espana, S.L.U. changed its name to Atalaya Masa Valverde, S.L.U on 28 November 2020.

(3) Rio Narcea Nickel, S.L.U. changed its name to Atalaya Ossa Morena, S.L.U on 31 January 2022. In July 2022, Atalaya increased its ownership
interest in Proyecto Ossa Morena to 99.9%, up from 51%, following completion of a capital increase that will fund exploration activities.

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

The following transactions were carried out with related parties:

30.2 Compensation of key management personnel

The total remuneration and fees of Directors (including executive Directors) and other key management personnel
was as follows:

(Euro 000’s)

Directors’ remuneration and fees

Director’s bonus (1)

Share option-based benefits to Directors

Key management personnel remuneration (2)

Key management bonus (1)

Share option-based and other benefits to key management personnel

The Group

The Company

2022

1,028

357

426

571

239

417

2021

1,019

438

321

522

265

327

2022

540

2021

547

3,038

2,892

540

547

(1) These amounts related to the approved performance bonus for 2021 by the Board of Directors following the proposal of the Remuneration
Committee. The 2022 estimates recorded are not included in the table above as this is yet to be approved by the Board of Directors. There is
no certainty or guarantee that the Board of Directors will approve a similar amount for 2022 performance.

(2) Includes wages and salaries of key management personnel of €551k (2021: €505k) and other benefits of €20k (2021: €17k).

Atalaya Mining Plc.

158

Consolidated and Company Financial Statements

Notes to the Consolidated and Company Financial Statements

At 31 December 2022 amounts due to Directors, as from the Group, are €nil (€nil at 31 December 2021) and €nil
(€nil at 31 December 2021) to key management.

At 31 December 2022 amounts due to Directors, as from the Company, are €nil (€nil at 31 December 2021) and €nil
(€nil at 31 December 2021) to key management.

Share-based benefits

In 2022, 1,345,000 options (2021: 1,150,000 options) were granted at a price of 357.5 pence, of which 800,000 (2021:
800,000 options) were granted to Directors and key management personnel (see note 23).

During 2022 the Directors and key management personnel have not been granted any bonus shares (2021: nil).

30.3 Transactions with shareholders and related parties

The Group

(Euro 000’s)

Trafigura – Revenue from contracts

Freight services

Gains/(losses) relating provisional pricing within sales

Trafigura – Total revenue from contracts

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

The Company

(Euro 000’s)

Sales of services (Note 5):

» EMED Marketing Limited

» Atalaya Riotinto Minera, S.L.U.

» Atalaya Minasderiotinto Project (UK) Limited

Purchase of services (Note 6):

» Atalaya Riotinto Minera, S.L.U.

Other services (Note 6):

» Atalaya Riotinto Minera, S.L.U.

» EMED Marketing Limited

Finance income (Note 8):

Atalaya Minasderiotinto Project (UK) Limited – Finance income from interest-bearing loan:

» Credit agreement – at amortised cost

» Participative loan – at fair value through profit and loss

» Credit facility – at amortised cost

» Restructuring loan – at amortised cost

The Group

(Euro 000’s)

Current assets - Receivable from related parties (Note 19):

» Recursos Cuenca Minera S.L.

The above balances bear no interest and are repayable on demand.

Atalaya Mining Plc.

2022

2021

77,005

(5,165)

71,840

125,912

4,730

130,642

2022

2021

1,404

1,352

2,756

(66)

989

9,157

1,465

1,289

12,900

978

871

1,849

(61)

208

941

12,854

1,457

15,252

2022

2021

Notes to the Consolidated and Company Financial Statements

Consolidated and Company Financial Statements

159

30.4 Year-end balances with related parties

The Company

(Euro 000’s)

Non-current assets – Loan from related parties at FV through profit and loss (Note 19):

Atalaya MinasdeRiotinto Project (UK) Limited – Participative Loan PRT(1)

Atalaya MinasdeRiotinto Project (UK) Limited – Eastern Loan(5)

Atalaya Masa Valverde SL – Participative Loan(6)

Atalaya Ossa Morena SL – Participative Loan(6)

Touro Project – Participative Loan(4)

Total

Non-current assets – Loans and receivables from related parties at amortised cost (Note 19):

Atalaya MinasdeRiotinto Project (UK) Limited – Restructuring loan(1)

Atalaya MinasdeRiotinto Project (UK) Limited – Credit Expansion Loan(2)

Atalaya MinasdeRiotinto Project (UK) Limited – Credit Agreement(3)

EMED Marketing Limited(4)

Atalaya MinasdeRiotinto Project (UK) Limited– Group cost sharing(4)

Total

Current assets – Loans and receivables from related parties at amortised cost (Note 19):

Atalaya Riotinto Minera, S.L.U.(4)

EMED Marketing Limited(4)

Atalaya Touro (UK) Limited(4)

Atalaya MinasdeRiotinto Project (UK) Limited

Atalaya Financing Ltd

Total

2022

2021

6,150

3,100

4,997

14,247

245,258

399

245,657

1,352

664

1,650

45,000

108

48,774

173,930

1,850

500

176,292

41,535

26,354

1,164

399

69,452

208

1,634

2,084

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

(1) This balance bears interest of EURIBOR 12month plus 3.50%. The Participative loan was cancelled on 30 November 2022. The Group signed
on 1 December 2022 a new Loan Restructuring Agreement for the amount due of the Participative Loan bearing a EURIBOR 12month plus
3.50% interest and maturing on 30 November 2028.

(2) This balance bears interest of EURIBOR 6month plus 4% (2021: LIBOR 6month + 4.00%).

(3) This balance bears interest of EURIBOR 12month plus 4% (2021: 12month plus 4%). The Note Facility Agreement expired on 29 September
2019. The Group signed on 30 September 2019 a new Credit Agreement for the amount due of the Note Facility Agreement bearing a
EURIBOR 12month plus 4% interest and maturing on 30 September 2024

(4) These receivables bear no interest. These balances are repayable on demand. However, management will not claim any repayment in the
following twelve months period after the release of the current consolidated financial statements.

(5) This balance bears interest of 3.00% (2021: 3.00%).

(6) This balance bears no interest.

The Company

(Euro 000’s)

Payable to related party (Note 25):

EMED Marketing Limited

EMED Mining Spain S.L.

Atalaya Riotinto Minera, S.L.U.

The above balances bear no interest and are repayable on demand.

Atalaya Mining Plc.

2022

2021

3,825

262

372

634

160

Consolidated and Company Financial Statements

Notes to the Consolidated and Company Financial Statements

30.5 Year-end balances with shareholders

(Euro 000’s)

2022

2021

Receivable from shareholders (Note 19):

Trafigura – Debtor balance –subject to provisional pricing

12,800

20,283

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

The above debtor balance arising from the pre-com-
missioning sales of goods bear no interest and is
repayable on demand.

31. Contingent liabilities

Judicial and administrative cases

In the normal course of business, the Group may be
involved in legal proceedings, claims and assessments.
Such matters are subject to many uncertainties, and
outcomes are not predictable with assurance. Legal
fees for such matters are expensed as incurred and the
Group accrues for adverse outcomes as they become
probable and estimable.

32. Commitments

There are no minimum exploration requirements at
Proyecto Riotinto. However, the Group is obliged to
pay local land taxes which currently are approximately
€235,000 per year in Spain and the Group is required
to maintain the Riotinto site in compliance with all
applicable regulatory requirements.

In 2012, Atalaya Riotinto Minera, S.L.U. entered into a
50/50 joint venture with Rumbo to evaluate and exploit
the potential of the class B resources in the tailings
dam and waste areas at Proyecto Riotinto (mainly
residual gold and silver in the old gossan tailings).
Under the joint venture agreement, ARM will be the
operator of the joint venture, will reimburse Rumbo for
the costs associated with the application for classifi-
cation of the Class B resources and will fund the initial
expenditure of a feasibility study up to a maximum of
€2.0 million. Costs are then borne by the joint venture
partners in accordance with their respective owner-
ship interests.

33. Significant events

The events in Ukraine from 24 February 2022 are
impacting the global economy but cannot yet be
predicted in full. The main concern now is the rising
prices for energy, fuel and other raw materials and
rising inflation, which may affect household incomes
and business operating costs. The financial effect of
the current crisis on the global economy and overall
business activities cannot be estimated with reason-
able certainty at this stage.

The main significant events disclosed during the nine
months ended 30 September 2022 were:

» On 4 January 2022 the subsidiary EMED Mining
Spain, S.L. was winded down (refer to Note 21).

» On 6 January 2022, the Company announced the
approval of the construction of the first phase of
an industrial scale plant (“Phase I”) that utilises the
E-LIX System (“E-LIX”), which will produce high
value copper and zinc metals from the complex
sulphide concentrates sourced from Proyecto
Riotinto.

» Through the year, the Company announced share
dealings from persons discharging managerial
responsibilities (“PDMR”) as follows:

ݖ On 26 January 2022, executed certain options by

PDMRs;.

ݖ On 22 February 2022, certain PDMRs had sold

ordinary shares of the Company;

ݖ On 25 August 2022, purchased of 65,000 ordinary

shares in Atalaya by a PDMR.

» On 27 January 2022, Atalaya announced that, in

accordance with the Company’s Long Term Inven-
tive Plan 2020, it had granted 120,000 share options.
Further, on 24 June 2022, it was announced the
Company has granted 1,225,000 share options to
PDMRs and other employees.

» On 3 February 2022, the Company announced the

results of five additional drill holes from its ongoing

Atalaya Mining Plc.

Notes to the Consolidated and Company Financial Statements

Consolidated and Company Financial Statements

161

resource definition drilling programme at Proyecto
Masa Valverde.

» On 24 March 2022, Atalaya announced that Mr.

Harry Liu has stepped down as a Non-Executive
Director of the Company with immediate effect.

» On 4 April 2022, funds managed by Hamblin Watsa
Investment Counsel Ltd. acquired 5.08% of voting
rights.

» The Company has been notified on the following
transaction by Allianz Global Investors GmbH
(“Allianz”):

ݖ On 4 April 2022, increased its % of voting rights

from below 3% to 3.92%;

ݖ On 4 May 2022, increased its % of voting rights

from 3.92% to 4.07%;

ݖ On 23 August 2022, increased its % of voting

rights from 4.07% to 5.09%; and

ݖ On 29 September 2022, decreased its share of

voting rights from 5.09% to 4.93%.

ݖ On 10 November 2022, decreased its share of

voting rights from 4.93% to 3.98%.

» On 5 April 2022, Atalaya announced a new Mineral
Resource Estimate, prepared in accordance with
CIM guidelines and disclosure requirements of NI
43-101, for its 100% owned Proyecto Masa Valverde.

» On 7 April 2022, the Company noted the announce-
ment on 1 April 2022 by ICBC Standard Bank Plc
(“ICBCS”) confirming the sale of the entire holding
of Yanggu Xiangguang Copper Co. Ltd (“XGC”) (via
its subsidiary, Hong Kong Xiangguang International
Holdings Ltd), in Atalaya.

» On 8 April 2022 and 9 May 2022, the Company trans-
ferred €9.6 million and €1.2 million to Astor from
the trust account already established by Atalaya on
15 July 2021 (refer to Note 13).

» On 13 April 2022, Atalaya announced new Mineral
Resource Estimates, prepared in accordance with
CIM guidelines and disclosure requirements of NI
43-101, for its San Dionisio and San Antonio deposits.

» On 25 April 2022, the Company announced the

publication of its inaugural Sustainability Report for
the year ended 31 December 2021.

» On 19 May 2022 the Board of Directors appointed
Kate Harcourt as an independent Non-Executive
Director of the Company.

» On 22 June 2022, the 2022 Annual General Meeting
was held, and all the resolutions proposed were
dully passed.

» On 23 June 2022, the Company has issued 22,500

ordinary shares of 7.5p in the Company pursuant to
an exercise of share options by an employee.

In July 2022, Atalaya increased its ownership
interest in Proyecto Ossa Morena to 99.9%, up from
51%, following completion of a capital increase that
will fund exploration activities.

» On 1 November 2022, the Company announced that
the Company’s Board of Directors established a
Sustainability Committee.

» The Company has been notified on the following
transaction by BlackRock Inc (“BlackRock”) On 9
November 2022, increased its % of voting rights to
4.03%;

» The Company announced that it was notified on

9 November 2022, that Enrique Delgado, a person
discharging managerial responsibilities (“PDMR”),
had sold 300,000 ordinary shares in Atalaya, respec-
tively, at a price of 272.25 pence per share.

» On 24 November 2022, the Company provided an

update on its ongoing exploration programme at its
southern Spain projects, including Proyecto Masa
Valverde (“PMV”), Proyecto Ossa Morena (“POM”),
and Proyecto Riotinto East (“PRE”). Currently, there
are four rigs active, three at PMV and one at POM.

Dividends

The Company’s Board of Directors elected to declare
an interim dividend for H1 2022 of US$0.036 per ordi-
nary share, which was equivalent to 3.13 pence per
share and amounted to €5.1 million.

The interim dividend was paid on 20 September 2022.

The Board of Directors has proposed a final dividend
for 2022 of US$0.0385 per ordinary share, which is
equivalent to approximately 3.15 pence per share
totalling €5.0 million. Payment of the Final Dividend
is subject to shareholder approval at the Company’s
2023 Annual General Meeting. Should it be approved,
the Final Dividend, together with the Interim Divi-
dend paid in September 2022, would result in a Full
Year Dividend of US$0.0745 per ordinary share, which
is equivalent to approximately 6.28 pence per share.
Further details on the timing of the potential payment
of the Final Dividend will be provided ahead of the
AGM.

Further details are given in Note 12.

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

Atalaya Mining Plc.

162

Consolidated and Company Financial Statements

Notes to the Consolidated and Company Financial Statements

34. Events after the
reporting period

» On 12 January 2023, the Company was notified that
Allianz Global Investors GmbH decreased its share
of voting rights from 4.93% to 3.98%.

» On 20 February 2023, Atalaya announced that

applied a voluntary delisting of its ordinary shares
from the Toronto Stock Exchange (the “TSX”) with
effective date of the closing of trading on 7 March
2023. Ordinary shares in the Company continue
to trade on the AIM market of the London Stock
Exchange under the symbol “ATYM”.

» On 23 February 2023, Atalaya announced the results

from a new preliminary economic assessment
(“PEA”) for the Cerro Colorado, San Dionisio and San
Antonio deposits at its Proyecto Riotinto (“Riotinto”)
operation in Spain.

Delisting from TSX took effect at the close of trading
on 20 March 2023.

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

Atalaya Mining Plc.

164

2022 Annual Report

0 8

Shareholder
Information

Atalaya Mining Plc

165

CONTENT 08:

8 . 1

Glossary of Terms

8 . 2

Shareholder Enquiries

166

170

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

166

8.1

Shareholder Information

Glossary of terms

The following definitions and terms are used throughout this Annual Report.

CURRENCY ABBREVIATIONS

US$ / USD or $ US Dollars

$000 Thousand US dollars

$m Million US Dollars

Sterling Pound

£000 Thousand Sterling Pounds

£m Million Sterling Pounds

€ / EUR Euro

€000 / €k

Thousand Euros

€m Million Euros

€nil

Zero Euros

FY2022

Twelve month period ended 31 December 2022

FY2021

Twelve month period ended 31 December 2021

DEFINITIONS AND CONVERSION TABLE

lb Pound

Troy ounce

‘000 m³

Thousand cubic metres

Tonne

DMT Dry Metric Tonne

‘000 tonnes

Thousand metric tonnes

1 Kilogramme/ (kg)

2.2046 pounds

1000 Kilogrammes/ (´000 kg)

2,204.6 pounds

1 Kilometre (km)

0.6214 miles

1 troy ounce

31.1 grams

CHEMICAL SYMBOLS

Ha Hectare

Foot

Cu Copper

Ag Silver

Au Gold

Iron

BUSINESS, FINANCE AND ACCOUNTING

AAU Autorización Ambiental Unificada (Unified Environmental Declaration)

Atalaya or the Company Atalaya Mining Plc, a company incorporated in Cyprus under the Companies law, cap. 113

Atalaya Group or Group Atalaya Mining Plc and its subsidiaries

AFRC Audit and Financial Risk Committee

Atalaya Mining Plc.

Glossary of terms

Shareholder Information

167

AGM Annual General Meeting

AIM Alternative Investment Market of the London Stock Exchange

AISC All In Sustaining Cost

AMV Atalaya Masa Valverde, S.L.

AR Annual Report

ARM Atalaya Riotinto Minera, S.L.U.

Articles

The articles of association of Atalaya Mining Plc.

Average head grade Average ore grade fed into the mill, expressed in % of weight

BoD or Board of Directors

The Board of Directors of the Company

CAPEX Capital Expenditure

Cash Cost

The cost to produce one pound of copper

CEO Chief Executive Officer

C. Eng Chartered Engineer

CFO Chief Financial Officer

COO Chief Operational Officer

COF Cost of Freight

CIF Cost Insurance and Freight

CIT Corporate Income Tax

CIP Carriage and Insurance paid to

CGU Cash Generating Unit

CGNCC Corporate Governance, Numeration and Compensation Committee

Code of Conduct Atalaya’s Code of Business Conduct and Ethics

Cont. Continued

CSR Cobre San Rafael S.L.

Directors

The Directors of Atalaya for the reporting period

EBITDA Earnings Before Interest Tax Depreciation and Amortisation

ECL Expected Credit Loss

EeA Ecologistas en Accion

EIR Effective Interest Rate Method

E-LIX E-LIX System

EMED TARTESSUS Eastern Mediterranean Exploration & Development TARTESSUS S.L.

Etc. Et cetera

EU European Union

FIFO First In First Out

Financial statements Consolidated and company financial statements of Atalaya Mining Plc.

FOB Free on Board

FV Fair Value

FVOCI

Fair Value Through Other Comprehensive Income

FVPL

Fair Value Through Profit or Loss

Fiscal year

GAAP Generally Accepted Accounting Policies

Group Atalaya Mining plc and its subsidiaries

H1, H2

Six month periods ending 30th June and 31st December

IAS

International Accounting Standards

ie.

Id est (explanatory information)

IFRS

International Financial Reporting Standards

Atalaya Mining Plc.

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

Atalaya Mining Plc.

168

Shareholder Information

Glossary of terms

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

100

101

102

103

104

105

106

107

108

109

110

111

112

113

114

115

116

117

118

IPO Initial Public Offering

JdA Junta de Andalucía

KPI´s Key Performance Indicators

LDC Louis Dreyfus Company

LIBOR The British Bankers’ Association Interest Settlement Rate for the relevant currency

LITFR Lost Injury Time Frequency Rate

Ltd.

Limited

LLC Limited Liability Company

LP Limited partnership

London Stock Exchange / LSE London Stock Exchange plc

MBA Master’s in Business Administration

NED´s Non-Executive Directors

NPV Net Present Value

Nr Number

OCI Other Comprehensive Income

Ordinary Shares Ordinary Shares of 10 pence each in the capital of the Company

Phase I

The first phase of an industrial-scale plant that utilises the E-LIX System

Ph.D. Doctor of Philosophy

PRC Physical Risk Committee

PFS Pre-Feasibility Study

Plc. Public limited company

POM Proyecto Ossa Morena

PP&E Plant, property and equipment

P&L Profit and Loss

P&P reserves Proven and Probable reserves

Q1, Q2, Q3, Q4 Three month periods ending 31st March, 30th June, 30th September and 31st December

QCA Quoted Companies Alliance

QP Quotation Period

RNN Rio Narcea Nickel, S.L.

SIC Standard Interpretations Committee which was endorsed by the IAS

Shareholders Holders of Ordinary Shares

Sociedad Limitada (private limited company)

SLU Sociedad Limitada Unipersonal (limited partnership)

TSX Toronto Stock Exchange

United Kingdom or UK the United Kingdom of Great Britain and Northern Ireland

United States or US

the United States of America, its territories and possessions, any state of the United States
of America and the District of Columbia

UOP Unit of Production

VAT Value Added Tax

WC Working Capital

XGC Yanggu Xiangguang Copper Co. Ltd

MINING TERMS

119

120

121

Average head grade Average ore grade fed into the mill, expressed in % of weight

Concentrate

A fine powdery product of the milling process containing a high percentage of valuable
metal

Contained copper

Represents total copper in a mineral reserve before reduction to account for tonnes not
able to be recovered by the applicable metallurgical process

Atalaya Mining Plc.

Glossary of terms

Shareholder Information

169

122

123

124

125

126

127

128

129

130

131

132

Grade

The amount of metal in each tonne of ore, expressed as a percentage of valuable metal

Mtpa Million tonnes per annum

NI 43-101

National Instrument 43-101, standard of disclosure for mineral projects according to
Canadian guidelines

Open pit

A mine where the minerals are mined entirely from the surface. Also referred to as
open-cut or open-cast mine

Ore body A sufficiently large amount of ore that can be mined economically

P&P Reserves Proven and Probable reserves

Stripping

Removal of overburden or waste rock overlying an ore body in preparation for mining by
open pit methods

Tailings

Materials left over after the process of separating the valuable fraction from the
uneconomic fraction of an ore

TC/RC Treatment Charge and Refinement Charge

VTEM Versatile Time Electomagnetic Mapping

3D Three Dimensional

2
0
2
2
A
n
n
u
a

R
e
p
o
r
t

Atalaya Mining Plc.

170

8.2

Shareholder Information

Shareholder Enquiries

BOARD OF DIRECTORS:

CORPORATE BROKERS:

REGISTRARS:

Roger Davey

Canaccord Genuity Limited

Cymain registrars Ltd.

Chair. Independent non-executive Chair

88 Wood Street

Alberto Lavandeira

Managing director and CEO

Jesus Fernandez

Non-executive director

Dr. Hussein Barma

Independent Non-executive director

Neil Gregson

Independent Non-executive director

Stephen Scott

Independent Non-executive director

Kate Harcourt

Independent Non-executive Director

London EC2V 7QR

BMO Capital Markets

100 Liverpool Street

London, EC2M 2RH

Peel Hunt LLP

100 Liverpool Street

London, EC2M 2AT

NOMAD:

Canaccord Genuity Limited

88 Wood Street London EC2V 7QR

INVESTOR RELATIONS:

Carina Corbett

4C Communications Ltd.

Hudson House

8 Tavistock Street

London WC2E 7PP

+44 (0) 203 170 7973

PUBLIC RELATIONS:

Elisabeth Cowell

Newgate Communications

Sky Light City Tower

50 Basinghall Street

London EC2V 5DE

+44 (0) 207 680 6550

26 Vyronos Avenue

1096 Nicosia, Cyprus

DEPOSITARY / TRANSFER AGENT:

United Kingdom

Computershare Investor Services Plc.

The Pavilions

Bridgwater

Bristol BS13 8AE

Canada

Computershare Investor Services Inc.

100 University Avenue

8th Floor, North Tower

Toronto, Ontario M5J 2Y1

COMPANY SECRETARY:

Inter Jura CY (Services) Limited

1 Lampousa Street,

1095 Nicosia, Cyprus

GROUP AUDITOR:

Ernst & Young Cyprus Ltd.

Jean Nouvel Tower,

6 Stasinos Avenue,

P.O.Box 21656,

1511, Nicosia,

Cyprus

REGISTERED OFFICE:

1 Lampousa Street,

1095 Nicosia, Cyprus

t
r
o
p
e
R

a
u
n
n
A
2
2
0
2

Atalaya Mining Plc.

2 0 2 2

ANNUAL REPORT

Atalaya Mining Plc

atalayamining.com

Spain office

Registered office

Cyprus office

La Dehesa s/n
Minas de Riotinto,
21660 - Huelva, Spain

1, Lambousa Street
Nicosia 1095,
Cyprus

3, Ayiou Demetriou Street
Acropolis 2012
Nicosia, Cyprus