Company Registration No: 05234262
Cadence Minerals PLC
Annual Report and Accounts
For the year ended 31 December 2024
CADENCE MINERALS PLC
COMPANY INFORMATION
For the year ended 31 December 2024
___________________________________________________________________________________
Company registration number:
05234262
Registered office:
c/o Hill Dickinson LLP
The Broadgate Tower
Primrose Street
London
EC2A 2EW
Directors:
Andrew Suckling (Non-Executive Chairman)
Kiran Morzaria (Chief Executive Officer)
Donald Strang (Executive Finance Director)
Adrian Fairbourn (Non-Executive Director)
Secretary:
Donald Strang
Nominated adviser and
Nominated broker:
W. H. Ireland Limited
24 Martin Lane
London
EC4R 0DR
Registrars:
Neville Registrars Limited
Neville House
18 Laurel Lane
Halesowen
West Midlands
B63 3DA
Bankers:
Barclays Bank Plc
1 Churchill Place
London
E14 5HP
Solicitors:
Hill Dickinson LLP
The Broadgate Tower
20 Primrose Street
London
EC2A 2EW
Auditors:
PKF Littlejohn LLP, Statutory Auditor
15 Westferry Circus
London
E14 4HD
CADENCE MINERALS PLC
CONTENTS
For the year ended 31 December 2024
___________________________________________________________________________________
OUR BUSINESS AND INVESTMENT STRATEGY ......................................................................................................1
CHAIRMAN’S STATEMENT ...................................................................................................................................2
CHIEF EXECUTIVE OFFICER’S COMMENTARY ........................................................................................................4
INVESTMENT REVIEW ..........................................................................................................................................5
FINANCIAL REVIEW ............................................................................................................................................ 12
PRINCIPAL RISKS AND UNCERTAINTIES .............................................................................................................. 12
DIRECTORS’ SECTION 172 STATEMENT .............................................................................................................. 14
REPORT OF THE DIRECTORS ............................................................................................................................... 16
DIRECTORS’ RESPONSIBILITIES STATEMENT ....................................................................................................... 19
CORPORATE GOVERNANCE ............................................................................................................................... 20
BOARD MEMBERS ............................................................................................................................................. 26
REPORT ON REMUNERATION ............................................................................................................................ 29
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF CADENCE MINERALS PLC......................................... 31
STATEMENT OF COMPREHENSIVE INCOME ....................................................................................................... 38
STATEMENT OF FINANCIAL POSITION ................................................................................................................ 39
STATEMENT OF CHANGES IN EQUITY ................................................................................................................. 40
STATEMENT OF CASH FLOWS ............................................................................................................................ 41
PRINCIPAL ACCOUNTING POLICIES .................................................................................................................... 42
NOTES TO THE FINANCIAL STATEMENTS ............................................................................................................ 52
Forward-looking Statement
This annual report contains ‘forward-looking information’, which may include but is not limited to statements concerning the future. This annual
report contains ‘forward-looking information’, which may include but is not limited to statements with respect to the future financial and operating
performance of Cadence Minerals, the estimation of mineral resources, the realisation of mineral resource estimates, costs of production, capital
and exploration expenditures, costs and timing of the development of new deposits, requirements for additional capital, governmental regulation
of mining operations and exploration operations, timing and receipt of approvals, licenses, environmental risks, title disputes or claims.
Often, but not always, forward-looking statements can be identified by the use of words such as ‘plans’, ‘expects’, ‘is expected’, ‘budget’,
‘scheduled’, ‘estimates’, ‘forecasts’, ‘intends’, ‘anticipates’ or ‘believes’, or variations (including negative variations) of such words and phrases, or
state that specific actions, events or results ‘may’, ‘could’, ‘would’, ‘might’ or ‘will’ be taken, occur or be achieved. Forward-looking statements
involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of Cadence
and/or its subsidiaries, investment assets and/or its affiliated companies to be materially different from any future results, performance, or
achievements expressed or implied by the forward-looking statements.
Such factors include, among others, general business, economic, competitive, political and social uncertainties; the actual results of current
exploration activities; conclusions of economic evaluations and studies; fluctuations in the value of UK Pounds Sterling relative to the United States
Dollar, and other foreign currencies; changes in project parameters as plans continue to be refined; future prices of products; possible variations
of ore grade or recovery rates; failure of plant, equipment or processes to operate as anticipated; accidents, labour disputes and other risks of the
mining industry; political instability, adverse weather conditions, insurrection or war; delays in obtaining governmental approvals or financing or
in the completion of development or construction activities.
Although Cadence has attempted to identify important factors that could cause actual actions, events, or results to differ materially from those
described in forward-looking statements, other factors may well cause them to differ from those currently anticipated, estimated, or intended.
Forward-looking statements contained herein are made as of the date of this annual report. Cadence disclaims any obligation to update any
forward-looking statements, whether as a result of new information, future events or results or otherwise. There can be no assurance that forward-
looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements.
Accordingly, readers should not place undue reliance on forward-looking statements due to the inherent uncertainty therein. Nothing in this annual
report should be construed as a profit forecast.
CADENCE MINERALS PLC
STRATEGIC REPORT
For the year ended 31 December 2024
1
OUR BUSINESS AND INVESTMENT STRATEGY
Cadence Minerals is an early-stage investment and development company in the mineral resource sector. It is
listed on the Alternative Investment Market (“AIM”) of the London Stock Exchange (“LSE”).
Our strategy is to identify undervalued assets with strategic advantages that can deliver capital growth to our
shareholders. We invest in these assets and assist in driving capital growth if required.
To meet the long-term demand, we recognise that the metals and mining sectors require focused investment
capital from knowledgeable investors who understand the significant risks involved in the mineral resource
sector and know how to mitigate these risks to maximise potential returns for our investors.
Our investment strategy encompasses investments in private assets, utilising a private equity approach, as
well as public equity investments in companies listed on stock exchanges. These investments can be held
actively or passively.
Active investments, a key part of our strategy, involve substantial investments where Cadence proactively
manages investee companies. This hands-on approach, providing oversight and guidance at the board level, is
designed to enhance shareholder value and minimise downside risk, ensuring our commitment to maximising
returns.
Our private investments include mineral exploration and development projects conducted through joint
venture companies or joint venture licenses. Joint venture companies operate these projects in partnership
with in-country experts with the necessary knowledge and expertise to advance the projects. In this segment
of our investment portfolio, we have recently become actively involved in the management and decision-
making of our investee companies, but never take control. We utilise legal agreements to implement negative
control mechanisms, thereby protecting the Company's investments. Ideally, we seek to fund private
investments through earn-ins and incentivise our joint venture partners with equity in Cadence based on
deliverables that add value.
In our Equity Investment segment, we focus on undervalued assets within our trading portfolio. These are
listed mining equities that the board, with its keen eye for potential, considers undervalued by the market.
We see significant upside potential in these assets, whether through exploration success or the development
of mining projects towards commercial production, aiming to achieve capital gains in the short to medium
term.
Furthermore, we aim to mitigate our risk exposure by gaining a deep fundamental understanding of each
investment, including its potential economics, operating and legal environment, and management team. By
conducting thorough evaluations, we can eliminate many potential investments and focus on funding projects
that we believe will deliver value to our shareholders.
CADENCE MINERALS PLC
STRATEGIC REPORT
For the year ended 31 December 2024
2
CHAIRMAN’S STATEMENT
Dear Shareholders,
As we reflect on the year 2024 and the first half of 2025, Cadence Minerals has demonstrated resilience and
strategic clarity amidst a volatile global environment. Despite challenges across markets, we achieved critical
milestones, made tangible progress at our flagship projects, and continued to position the Company for long-
term value creation.
Amapá Iron Ore Project – Advancing a Strategic Asset
Our Amapá Iron Ore Project in Brazil remains the cornerstone of our strategy. During 2024, metallurgical
testing confirmed the project's capability to produce high-grade, Direct Reduction (“DR”) quality iron
concentrate with a Fe content of 67.5%, accompanied by low impurities. This is a significant milestone—not
only technically, but commercially.
Global demand for DR-grade iron ore is accelerating, driven by the decarbonisation of steel production. DR-
grade feedstock is crucial for direct reduced iron (DRI) and electric arc furnace (EAF) steelmaking, both of
which produce significantly fewer emissions compared to traditional blast furnaces. As steelmakers transition
to lower-carbon processes, the premium for DR-grade material has widened considerably. In 2024, premiums
for DR-grade concentrate ranged from $15 to $45 per tonne over the benchmark 62% Fe fines, depending on
location and purity. Analysts project that global demand for DR-grade products could rise more than fivefold
by 2050, and availability remains constrained.
Cadence’s ability to deliver a reliable source of DR-grade concentrate from Amapá places us in a unique
position to serve this growing market. Our development activities have focused on progressing licensing,
advancing engineering studies, and preparing for phased production. These efforts align with our strategy to
create a vertically integrated, sustainable iron ore business.
Iron Ore Market Dynamics
The iron ore market demonstrated resilience in 2024, with benchmark 62% Fe prices trading between US$100
and US$130 per tonne. As we entered 2025, prices hovered near $100 per tonne, and while sentiment remains
cautious, structural demand for higher-grade ores—including DR-grade—remains firm. Major producers
adjusted guidance downward, and cost pressures became a dominant theme.
In this context, Cadence’s emphasis on quality over volume has been validated. Our focus on producing
premium-grade material aligns with where value and margin are migrating in the industry.
UK Equity Market Pressures
Cadence continues to operate against a backdrop of systemic headwinds in the UK equity market. In 2024, UK
equity markets experienced continued outflows, with approximately £13.1 billion withdrawn from UK-focused
funds, marking the third consecutive year of significant redemptions. This sustained capital flight contributed
to a sharp contraction in the junior AIM market, which saw a net loss of 74 companies and fell to its smallest
size in over two decades.
While challenging, this environment has reinforced our focus on delivering clear, long-term shareholder value.
Cadence remains committed to transparent governance, prudent financing, and project development driven
by progress—qualities we believe will be rewarded over time.
CADENCE MINERALS PLC
STRATEGIC REPORT
For the year ended 31 December 2024
3
CHAIRMAN’S STATEMENT (CONTINUED)
Lithium Market Stabilisation
The lithium market experienced significant price corrections in 2024, with spot prices falling nearly 85% from
their 2022 peaks. However, by late 2024 and into early 2025, signs of stabilisation began to emerge. Temporary
mine closures and improving electric vehicle (EV) sales—particularly in China—helped rebalance supply and
demand. Analysts now anticipate a more stable pricing environment in 2025, with growing downstream
demand from electric vehicles (EVs) and energy storage systems supporting medium- and long-term
fundamentals.
Looking Ahead
Our operational focus remains firmly on advancing the Amapá Iron Ore Project and unlocking its full potential.
With a high-grade, DR-capable resource, supportive long-term trends, and a strategic location, Amapá
represents a cornerstone for our future growth. We continually evaluate new opportunities within our core
competencies and jurisdictions that complement our strategic direction.
I want to thank our shareholders for their continued support, as well as our team and partners for their
dedication throughout a transformative year. Cadence enters 2025 with momentum, clarity, and a deep
commitment to building sustainable value for all stakeholders.
Andrew Suckling
Non-Executive Chairman, 18 June 2025
CADENCE MINERALS PLC
STRATEGIC REPORT
For the year ended 31 December 2024
4
CHIEF EXECUTIVE OFFICER’S COMMENTARY
I am pleased to present the audited results for the year ended 31 December 2024, along with the Strategic
Report, which comprehensively reviews our business activities. These results reflect the historical position of
the Company's progress and financial standing. We have included additional information on key post-year-
end events in the Strategic Report.
At the core of our efforts in 2024 was the continued advancement of the Amapá Iron Ore Project in Brazil. We
successfully completed an optimisation study that significantly enhanced the project’s economics, delivering
a 33% reduction in beneficiation plant capex and lifting post-tax NPV to US$1.97 billion based on our 67% Fe
"Green Iron" flowsheet. The development of this Direct Reduction (DR) grade product positions Amapá to
serve the expanding low-carbon steel market, which increasingly demands high-purity iron ore for use in
Electric Arc Furnace (EAF) and hydrogen-based Direct Reduced Iron (“DRI”) steelmaking.
The global iron ore market demonstrated resilience in 2024, with benchmark 62% Fe prices trading between
US$100 and US$130 per tonne. Pricing was supported by steady Chinese steel production, infrastructure
stimulus, and the tight supply of high-grade ore. Notably, premiums for DR-grade material remained elevated
throughout the year, reflecting growing demand from decarbonisation-driven steelmaking. This price dynamic
reinforced the strategic importance of our “Green Iron” initiative and underpinned the robust economics of
the updated Amapá Project PFS.
Our lithium investments also advanced. Evergreen Lithium advanced exploration at the Bynoe Project,
intersecting pegmatites proximal to known resources and expanding its exploration footprint into gold-
prospective zones. While lithium prices softened over the period due to oversupply and destocking in the
battery supply chain, we believe the structural outlook remains intact, with long-term demand growth driven
by the adoption of electric vehicles and stationary storage.
We divested from Hastings Technology Metals and European Metals Holdings, realising 30% and 174% returns,
respectively. These divestments were made in line with our strategy to recycle capital into high-conviction,
near-development stage assets—particularly Amapá—while minimising exposure to public equity volatility.
UK equity markets continued to suffer from persistent outflows in 2024, with investor appetite shifting
offshore. This broader market trend negatively impacted valuations across our listed holdings, but our
proactive approach to capital management helped preserve and redeploy value effectively.
Post-period, we progressed permitting for Amapá, responded to additional regulatory requests, and continued
efforts to secure a construction partner and financing solution that minimises dilution. Our investment to
date—approximately US$15.5 million for a 35.7% stake—reflects our deep commitment to bringing this
project into production and capturing the full value of its extensive infrastructure and resource base.
Regarding our investment in the Sonora Lithium Project, Cadence is engaged in legal and diplomatic processes
following the Mexican government's cancellation of lithium concessions. In November 2023, we submitted a
formal Request for Consultations under the UK-Mexico Bilateral Investment Treaty. We believe that our rights
under Mexican and international law have been breached, and we will pursue all available remedies.
Looking ahead, Cadence remains focused on unlocking long-term shareholder value by advancing our core
assets, securing non-dilutive funding, and actively managing our portfolio in line with market cycles. We are
confident that our strategy, anchored by a world-class iron ore project, positions us well for the year to come.
Kiran Morzaria
Chief Executive Officer, 18 June 2025
CADENCE MINERALS PLC
STRATEGIC REPORT
For the year ended 31 December 2024
5
INVESTMENT REVIEW
As outlined in the section “Our Business and Investment Strategy,” Cadence operates an investment strategy
that involves investing in private projects through a combination of private and public equity models. In both
investment classes, we take either an active or passive role. We have reported in these segments below.
PRIVATE INVESTMENTS, ACTIVE
The Amapá Iron Ore Project, Brazil
Interest – 34.7% at 31/12/2024 and 35.7% at 1/05/2025
The Amapá Project is a large iron ore mine with rail, port, and beneficiation facilities. It operated from
December 2007 until 2014, when a geotechnical failure at the port led to a limitation on exports. Before
closing, the Project earned profits of US$54 million in 2012 and US$120 million in 2011. In 2008, it produced
712 thousand tonnes of iron ore concentrate, increasing to 4.8 million tonnes in 2011 and 6.1 million tonnes
in 2012.
Investment
In 2019, Cadence entered into a binding investment agreement to invest in and acquire up to 27% of the
Amapá iron ore mine, beneficiation plant, railway, and private port owned by DEV Mineração S.A. ("DEV").
The agreement also granted Cadence a first right of refusal to increase its stake to 49%.
To acquire its 27% interest, Cadence has invested US$6 million in the Amapá Project over two stages. The first
stage acquired 20% of PBA for US$2.5 million, and the second stage acquired an additional 7% for US$3.5
million. These investments were completed in the first quarter of 2022. By the end of 2024, Cadence invested
about £11.34 million (US$14.38 million) for a 34.7% stake in the Amapá Project. As of the end of March 2025,
Cadence invested about US$14.7 million for a 34.9% stake in the Amapá Project.
Operations Review
Cadence Minerals made substantial operational and strategic progress at the Amapá Iron Ore Project during
the reporting period and into 2025. At the end of 2024, we set several key operational targets. These included
submitting the environmental license applications and their grant, improving the project’s economics through
increased production and capital savings, and, most importantly, completing metallurgical test work for our
planned "green iron" 67% iron ore concentrate.
We achieved most of these targets, and in the case of the 67% flow sheet, we substantially improved the
project's economics.
Optimisation Studies and Revised PFS Economics
In July 2024, Cadence and its joint venture, Pedra Branca Alliance (PBA), completed a preliminary feasibility
study (PFS)- level optimisation study, resulting in a 33% reduction (US$63.2 million) in beneficiation plant
capital expenditure. The overall project capital intensity was reduced to US$58 per tonne of annual capacity,
placing it in the bottom quartile of global comparable. The updated PFS, published in July 2024, reflected
increased plant throughput to 5.8 Mtpa and lower operating costs. Key financial metrics improved significantly
compared to the 2023 PFS.
Key Results from the 2024 Updated PFS (Base Case – 65.4% Product):
•
Post-tax NPV (10%):
US$1.145 billion
•
Post-tax IRR:
42%
•
Annual production:
5.82 Mtpa (4.81 Mtpa at 65.4% Fe, 1.01 Mtpa at 62% Fe)
•
C1 cash costs:
US$33.50/dmt FOB; US$62.20/dmt CFR
•
Post-tax profit (LOM): US$3.14 billion
•
Project payback:
4 years
CADENCE MINERALS PLC
STRATEGIC REPORT
For the year ended 31 December 2024
6
INVESTMENT REVIEW (CONTINUED)
The Amapá Iron Ore Project, Brazil (continued)
Addition of 67% Fe ‘Green Iron’ Flowsheet and Updated DR Grade PFS.
A core strategic initiative throughout 2024 and 2025 has been developing a 67% Fe Direct Reduction (“DR”)
grade concentrate, known internally as the ‘Green Iron’ flowsheet. This product targets the growing low-
carbon steel sector, particularly Electric Arc Furnace (EAF) and Direct Reduced Iron (DRI) markets.
Test work completed in Q4 2024 by Pei Si Engineering Inc. confirmed that a DR-grade concentrate can be
produced at 67.5% Fe, with combined SiO₂ and Al₂O₃ below 1.5%. The process flowsheet incorporates
regrinding, magnetic separation (LIMS and HIMS), and two-stage reverse flotation.
Based on the July base case results, Cadence developed and tested a 67% Fe "Green Iron" flowsheet, aiming
to produce a high-purity, Direct Reduction (DR) grade concentrate targeting the low-carbon steel sector.
Metallurgical test work completed in Q4 2024 confirmed the flowsheet’s viability at a PFS level of accuracy.
The product achieved 67.5% Fe with less than 1.5% total SiO₂ and Al₂O₃ impurities.
Key Results from the 2024 Updated DR Grade PFS – 67% Fe Flowsheet Case:
•
Post-tax NPV (10%):
US$1.97 billion
•
Post-tax IRR:
56%
•
Annual production:
5.5 Mtpa
•
C1 cash costs:
US$33.7/dmt FOB; US$61.9/dmt CFR
•
Post-tax profit (LOM): US$4.9 billion
•
Project payback:
3 years
•
Annual Free Cash Flow: Estimated to be US$342 million.
The updated flowsheet will eliminate the 62% product stream and reduce power consumption by replacing
the jigging and spiral circuits. The beneficiation process now includes additional magnetic separation.
Environmental Licensing and Permitting
As announced in September 2023 (UPDATE - Amapá Iron Ore Project), the Amapá Project has agreed with the
Amapá State. Environmental Agency ("SEMA") to an expedited environmental licensing process, given that the
Project was previously operating and had been granted all required licenses.
The Amapá Project owns the required Mining Concessions; however, it must obtain a Mine Extraction and
Processing Permit ("Mining Permit") to begin operations. To obtain this permit, the Amapá Project must secure
an Installation License ("LI") to commence construction, and once constructed, an Operational License ("LO").
Both an LI and an LO are also required to build and operate the railway and port.
In April 2024, the Amapá Project submitted the required environmental studies and applications for the
Amapá mine and railway. These applications took the form of the Environmental Control Plan, "PCA" (Plano
de Controle Ambiental), and an Environmental Control Report, "RCA" (Relatório de Controle Ambiental). The
project followed this up in early September by submitting the necessary environmental studies and application
for the LI grant for the iron ore port.
This submission was based on consultations with SEMA and a Terms of Reference agreed upon by both parties.
We were informed that the terms of reference (ToR) contained all the requirements for the LI to be granted
by the end of 2024. However, before the end of the year, SEMA informed The Amapá Project that additional
information and federal clearance were required for the mine and railway LI.
CADENCE MINERALS PLC
STRATEGIC REPORT
For the year ended 31 December 2024
7
INVESTMENT REVIEW (CONTINUED)
The Amapá Iron Ore Project, Brazil (continued)
The Project team has delivered all core documentation in line with the agreed-upon. While the full grant of
licences was initially anticipated by year-end 2024, SEMA subsequently issued further requests for
supplementary documentation and technical studies. The majority of these items have now been completed
or are nearing finalisation.
•
Mining Installation Licence: Most supplementary documentation is complete. The key outstanding
requirement is a detailed archaeological study, along with other technical inputs and waivers that are
either submitted or in advanced preparation.
•
Railway Installation Licence: Approximately 95% of requirements have been met, with final technical
submissions currently underway.
•
Port Installation Licence: Approval timelines have been extended due to the site’s historical incident
record and redesign of key loading infrastructure.
We remain fully engaged in securing all outstanding approvals and remain confident that, with continued
regulatory cooperation, installation licences will be granted in due course.
Tailings Storage Facility (“TSF”)
Cadence's initial investment criterion for the Amapá Project was the safety and stability of the TSF. Before the
investment agreement with our partners, we conducted a TSF review by an internationally recognised
consulting group and were satisfied with its structure and stability. However, the lack of reporting and
maintenance since 2014 has deemed the TSF high risk. Work since 2019, including maintenance and
compliance, has brought the TSF closer to the lowest risk rating. We aim to improve its risk rating further
through a dam break study, installing video monitoring, and ongoing inspection and remediation of TSF
infrastructure.
Secured Bank Settlement Iron Ore Shipments
According to the settlement agreement announced in December 2021, the net proceeds from one shipment
made in 2022 and approximately half of the net proceeds from shipments in 2021 have been utilised to pay
the secured bank creditors. We have maintained a productive dialogue with the secured bank creditors
regarding the best approach to repay the historic lender amounts. We believe that a one-time settlement
using DEV’s stockpile of iron ore as collateral would be the optimal solution, and we are progressing
discussions with the secured bank creditors on this matter. (UPDATE - Execution of Settlement Agreement)
Development Plan for the Amapá Project
We aim to reinstate this project into production. In 2024, we optimised the project to deliver a highly pure
iron ore concentrate and impressive financial metrics.
Throughout the year, we will maintain our focus on securing the LI and financing for the project. With various
work streams advancing. Cadence continues to believe that the optimal pathway to complete development is
through a strategic joint venture or sale and is in active discussions with several potential partners, ranging
from early-stage data review to site visits. However, this strategy does not eliminate the possibility that our
joint venture may develop the project independently or consider a trade sale.
To minimise execution risk and optimise capital efficiency, we are implementing a staged development
strategy. This approach begins with the recommissioning of a small-scale processing plant, followed by phased
capital deployment and a gradual ramp-up of production for the DR-grade product. All development activities
remain within the bounds of the current mining installation licences.
CADENCE MINERALS PLC
STRATEGIC REPORT
For the year ended 31 December 2024
8
INVESTMENT REVIEW (CONTINUED)
The Amapá Iron Ore Project, Brazil (continued)
In 2025, the Company initiated detailed engineering studies to evaluate the feasibility of this staged
development model. Initial findings suggest that the small-scale plant could be brought into production with
materially lower upfront capital requirements, subject to receipt of the relevant mining installation licences
and authorisation to utilise the existing tailings storage facility ("TSF").
Should we choose to develop the project independently, we will look to advance through staged investment,
gradually increasing production. The intent is to reduce the dilutive impact of equity funding by funding the
project's advancement from free cash flow. Contingent on financing availability, Cadence intends to maintain
its investment in the project.
PRIVATE INVESTMENTS, PASSIVE
Ferro Verde Iron Ore, Brazil
Interest - 1% on 31/12/2024 and 0% 31/05/2025
In 2022, Cadence invested a small amount (US$ 0.24 million) in an advanced iron ore deposit in Brazil the
previous year. The Ferro Verde Deposit is in the southern portion of the state of Bahia, in the northeastern
region of Brazil, next to the town of Urandi, some 700 km southwest of Salvador, the state of Bahia. We
disposed of this stake for circa (US$ 0.26 million).
PRIVATE INVESTMENTS, PASSIVE
SONORA LITHIUM PROJECT, MEXICO
Interest – 30% on 31/12/2024 and 31/05/2025
Cadence holds a 30% interest in the Sonora Lithium Project through its joint ventures Mexalit S.A. de C.V. and
Megalit S.A. de C.V., alongside majority partner Ganfeng Lithium Group. The project comprises nine
concessions in total, including La Ventana and La Ventana 1 (100% Ganfeng), El Sauz and Fleur (held via
Mexalit: 70% Ganfeng, 30% Cadence), and Buenavista and San Gabriel (held via Megalit: 70% Ganfeng, 30%
Cadence). Ganfeng is actively developing an open-pit mine and lithium hydroxide processing facility.
In 2022 and 2023, the Mexican Government amended its Mining Law to prohibit new lithium concessions,
classifying lithium as a strategic resource reserved for state ownership. However, concessions granted prior to
the reforms—such as those held by Mexalit and Megalit—were expected to remain valid under the principles
of legal certainty and non-retroactivity enshrined in the Mexican Constitution.
Despite this, in August 2023, the General Directorate of Mines (DGM) cancelled nine concessions, including
those belonging to Mexalit and Megalit, citing alleged non-compliance with minimum investment obligations
for the period 2017–2021. Both Cadence and Ganfeng strongly refute this claim, asserting that the required
investment thresholds were not only met but exceeded, with all supporting documentation and annual filings
submitted in accordance with Mexican mining regulations.
Cadence and its joint venture vehicle, REMML, believe these actions constitute breaches of the UK–Mexico
Bilateral Investment Treaty (BIT), including unlawful expropriation, failure to afford fair and equitable
treatment, and denial of due process. In November 2023, Cadence formally submitted a Request for
Consultations under the BIT, seeking an amicable resolution. This represents the first step in a structured
dispute process that may progress to international arbitration if necessary.
Cadence remains committed to protecting its legal and economic rights in the Sonora Lithium Project and will
pursue all available remedies under international and domestic law.
CADENCE MINERALS PLC
STRATEGIC REPORT
For the year ended 31 December 2024
9
INVESTMENT REVIEW (CONTINUED)
PUBLIC EQUITY
The public equity investment segment is composed of passive investments. The trading portfolio consists of
investments in listed mining entities that the board believes possess attractive underlying assets. The focus is
to invest in mining companies that are significantly undervalued by the market and where there is substantial
upside potential through exploration success and/or the development of mining projects for commercial
production. Ultimately, the aim is to make capital gains in the short to medium term. Investments are
considered individually based on various criteria and are typically traded on the TSX, ASX, AIM or LSE.
Our public equity investment incurred an unrealised loss of £1.02 million (2023: £3.10 million loss), primarily
due to the decline in the share price of Evergreen Lithium (EG1). Realised losses for the year amounted to
£1.10 million, stemming from the disposal of two holdings. The majority of the realised losses were
attributable to the divestment of our position in European Metals Holdings (EMH), resulting in a loss of £1.01
million (2023: £0.06 million loss). Additionally, the disposal of Hastings Technology Metals (HAS) generated a
realised loss of £0.09 million (2023: £2.56 million loss).
The movement in public portfolio values during the year is summarised below.
Commentary
£,000
Portfolio value on 31 December 2023
4,162
Disposal of public investments during the year
The majority of fund generated
from the disposal of EMH was used
for reinvestment in Amapa
(1,564)
Realised and Unrealised loss on portfolio value for
the year
The majority of these loss was due
to a reduction in the EMH and EG1
share prices.
(2,125)
Portfolio value on 31 December 2024
473
As of 31 December 2024, our public equity stakes consisted of the following:
Company
31-Dec-24
£,000
31-Dec-23
£,000
31-Dec-22
£,000
31-Dec-21
£,000
European Metals Holding Ltd
-
2,339
4,882
11,287
Charger Metals NL
-
-
301
342
Macarthur Minerals Ltd
-
-
-
181
Evergreen
469
1,481
-
-
Hasting Technology Metals
-
321
-
-
Eagle Mountain Mining Ltd
-
-
37
122
Miscellaneous
4
21
24
42
Total
473
4,162
5,244
11,974
CADENCE MINERALS PLC
STRATEGIC REPORT
For the year ended 31 December 2024
10
INVESTMENT REVIEW (CONTINUED)
PUBLIC EQUITY, ACTIVE
Evergreen Lithium Limited, Australia
INTEREST – 8.74% AT 31/12/2024 AND 5.62% ON 31/05/2025
Evergreen Lithium Limited is an Australian mineral exploration company focused on discovering and
developing lithium and gold resources. Its principal assets are located in the Northern Territory and Western
Australia. Evergreen’s flagship asset is the Bynoe Lithium Project, positioned near Core Lithium's Finniss
Lithium Project.
In July 2022, Cadence Minerals received approximately 15.8. 8 million shares in Evergreen Lithium
("Evergreen") when it sold its 31. 5% stake in Lithium Technologies and Lithium Supplies ("LT and LS") to
Evergreen, as announced on 27 June 2022. Evergreen was listed on the Australian Stock Exchange ("ASX") in
2023. Cadence's equity stake in Evergreen on its IPO was 8.74%. At the time of writing, the value of this stake
is approximately £0.3 million; our initial investment in this asset was £ 0.83 million.
Cadence is due an additional AS$6.63 million (£ 3.80 million) worth of shares in Evergreen upon Evergreen's
achieving certain performance milestones. The Evergreen prospectus provides further details of these
milestones.
During 2024, Evergreen Lithium advanced exploration activities at the Bynoe Project following the approval of
its Mine Management Plan (MMP). Evergreen undertook a high-impact drilling campaign that intersected
pegmatite formations along strike from Core Lithium's BP 33 and Booths prospects, confirming the geological
prospectivity for lithium mineralisation.
In addition to lithium targets, assays revealed anomalous gold mineralisation with notable intercepts. These
results have supported the expansion of exploration targets across both lithium and gold domains within the
Bynoe tenure.
Exploration across the Evergreen’s other assets—the Kenny Lithium Project (Western Australia) and the
Fortune Lithium Project (Northern Territory)—remained in early evaluation. Preliminary fieldwork and
geological mapping activities were undertaken to refine prospective zones ahead of more advanced
exploration.
In early 2025, Evergreen plans to build on the 2024 results by expanding exploration across the Bynoe Project.
Planned activities include detailed geochemical sampling, infill soil programs, and a follow-up drill campaign
targeting lithium-bearing pegmatites and gold anomalies.
PUBLIC EQUITY, PASSIVE
European Metals Holdings Limited (“European Metals”)
Interest –0% on 31/12/2024 and 31/05/2025
In 2024, the Cinovec Lithium Project made significant advancements, reinforcing its status as a vital lithium
asset in Europe. The year began with a focus on optimising the Definitive Feasibility Study (DFS). Engineering
on the Front-End Comminution and Beneficiation (FECAB) circuit improved lithium recovery to over 94.7%,
while concentrate grade rose to 3.14% Li₂O. Concurrently, the Lithium Chemical Plant (LCP) enhanced
efficiency through mixed sulphate recycling, reducing sodium sulphate use, costs, and increasing total recovery
to 88.1%. Overall, lithium recovery reached 83.3%.
CADENCE MINERALS PLC
STRATEGIC REPORT
For the year ended 31 December 2024
11
INVESTMENT REVIEW (CONTINUED)
PUBLIC EQUITY, PASSIVE
European Metals Holdings Limited (“European Metals”)
In April, a key milestone was achieved by relocating the proposed lithium processing plant from Dukla to the
Prunéřov 1 Power Station (EPR1) site, benefiting from rehabilitated land and existing infrastructure. This move
is anticipated to streamline permitting and enhance project economics. In May, European Metals redomiciled
to Australia, making the ASX its primary listing to align its corporate presence with its European focus and
improve access to EU development finance.
In Q3, the project gained institutional validation. The Cinovec Project was recommended for Just Transition
Fund support in July, aligning with regional goals. Exploration licences were also extended until 2026. Work on
the DFS continued, focusing on capital, operating expenditures, logistics, and mine-to-plant connectivity.
By December, European Metals completed a Concept Study on scaling production beyond the proposed
29,386 tonnes per annum lithium carbonate equivalent (LCE) without expanding the mine footprint. After
year-end, the project received recognition from the EU and Czech Government as a “Strategic Project” under
the EU Critical Raw Materials Act and a “Strategic Deposit” under Czech classification. These designations are
expected to accelerate permitting and reinforce the project’s role in Europe's lithium supply chain.
PUBLIC EQUITY, PASSIVE
Hastings Technology Metals, Australia
Interest – 0% on 31/12/2024 and 31/05/2025
In June 2022, Cadence agreed to sell its 30% working interest in the Yangibana Project leases to Hastings
Technology Metals (ASX: HAS) for A$9 million (£5.1 million). This was completed by issuing 2,452,650 new
ordinary shares in Hastings to Cadence. The transaction finished in January 2023, and Cadence has since sold
its entire investment in Hastings. The initial investment was £0.91 million, yielding a return of approximately
30%, with proceeds reinvested into the Amapá project.
At the end of February 2024, Cadence disposed of its interest in Hastings Technology Metals. The realised
return on our original acquisition of 30% of the mineral concessions (£0.9 million) was approximately 30% or
£0.3 million, and the sale proceeds were reinvested into the Amapá project.
CADENCE MINERALS PLC
STRATEGIC REPORT
For the year ended 31 December 2024
12
FINANCIAL REVIEW
Total comprehensive income for the year attributable to equity holders was a loss of £3.33m (2023: £3.02m).
This increase in loss from the previous year of approximately £0.31m is mainly due to the reduced amount of
realised and unrealised profits and losses on for the year of approximately £3.77m relating to our share
investment portfolio (listed financial investments) held during the year, and the disposal of our interest in
Mojito which contributed £3.9m profit in 2023. Administrative expenses were down £0.20m from £1.30m to
£1.10m, and foreign exchange losses were up £0.303m from a gain of £0.297 to a loss of £0.006m.
Basic negative earnings per share was 1.650p (2023: 1.762p).
The net assets of the Group at the end of the period were £17.21 million (2023: £18.45 million). This decrease
of approximately £1m reflects the losses and shares issued in the year.
PRINCIPAL RISKS AND UNCERTAINTIES
Cadence continuously monitors its risk exposures and reports its review to the Board. The Board reviews these
risks and focuses on ensuring effective systems of internal financial and non-financial controls are in place and
maintained.
The main business risk is considered to be investment risk.
The Company faces external risks that can materially impact or influence the investment environment within
which the Company operates and can include changes in commodity prices, and the numerous factors which
can influence those changes, including economic recession and investor sentiment and including the current
and potential effects of the coronavirus pandemic.
Commodity prices have an impact on the investment performance and prospects of all our investments. The
extent of the impact varies depending on a wide variety of factors but depend largely by where the investment
sits on the mineral development curve. The majority of Cadence’s investments sit at the more advanced stage
of the development curve. Commodity price risk is pervasive at all stages of the development curve, but other
prominent risks such as exploration risk and technical and funding risks at the exploration/development stage,
may be considered to be weighted higher earlier in the curve than pure commodity risk which tends to have
a greater impact on producers.
The Company’s investments are located in jurisdictions other than the UK and therefore carries with it country
risk, regulatory/permitting risk, political risk and environmental risk. Our investments can be at different
stages of development and each stage within the mining exploration and development cycle can carry its own
risks.
Where possible Cadence seeks to mitigate these risks by structuring its investments in a format which the
Board can influence, obtain high level oversight (often at board level) and use legal agreements to provide
control mechanisms (often negative control) to protect the Company’s investments. In addition, we seek to
further mitigate our risk exposure by obtaining a deep fundamental understanding of an asset, its potential
economics, operating and legal environment and its management team, prior to investment.
It should be noted that because the Company does not operate its project investments on a day-to-day basis,
there is a risk that the operator does not meet deadlines or budgets; fails to propose or pursue the appropriate
strategy; does not adhere to the legal agreements in place or does not provide accurate or sufficient
information to Cadence on a timely basis.
CADENCE MINERALS PLC
STRATEGIC REPORT
For the year ended 31 December 2024
13
PRINCIPAL RISKS AND UNCERTAINTIES (CONTINUED)
The Equity Investment segment of the Company’s investments is exposed to price risk within the market,
interest rate changes, liquidity risk and volatility. Although the investment risk within the portfolio is
dependent on many factors, the Group’s principal investments at the year-end are in companies with
significant iron ore and lithium assets and, to some extent, dependent on the market’s view of these
commodities or chemicals and/or the market’s view of the management of the companies in managing those
assets. As with our private investment, the Board seeks to mitigate this by obtaining a deep fundamental
understanding of an asset and its potential economics; its operating and legal environment and its
management team, prior to any investment by Cadence.
All countries carry political risk that can lead to interruption of activity. Politically stable countries can have
enhanced environmental and social risks; risks of strikes and changes to taxation; whereas less developed
countries can have, in addition, risks associated with changes to the legal framework; civil unrest and
government expropriation of assets. The Company has working knowledge of the countries in which the joint
venture holds exploration licences, and its local joint venture partner has experienced local operators to assist
the Company in its management of its investment in order to help reduce possible political risk.
CADENCE MINERALS PLC
STRATEGIC REPORT
For the year ended 31 December 2024
14
DIRECTORS’ SECTION 172 STATEMENT
The following disclosure describes how the Directors have had regard to the matters set out in section
172(1)(a) to (f) and forms the Directors’ statement required under section 414CZA of The Companies Act 2006.
This new reporting requirement is made in accordance with the new corporate governance requirements
identified in The Companies (Miscellaneous Reporting) Regulations 2018, which apply to company reporting
on financial years starting on or after 1 January 2019.
The matters set out in section 172(1) (a) to (f) are that a Director must act in the way they consider, in good
faith, would be most likely to promote the success of the Company for the benefit of its members as a whole,
and in doing so have regard (amongst other matters) to:
•
the likely consequences of any decisions in the long-term;
•
the interests of the Company’s employees;
•
the need to foster the Company’s business relationships with suppliers/customers and others;
•
the impact of the Company’s operations on the community and environment;
•
the Company’s reputation for high standards of business conduct; and
•
the need to act fairly between members of the Company.
As set out above in the Strategic Report the Board remains focused on providing for shareholders through the
long term success of the Company. The means by which this is achieved is set out further below.
Likely consequences of any decisions in the long-term;
The Chairman’s Statement, the Chief Executive Officer’s Commentary and the Strategic Review set out the
Company’s strategy. In applying this strategy, particularly in seeking new Project Investments and strategic
holdings in other public companies, the Board assesses the long term future of those companies with a view
to shareholder return. The approach to general strategy and risk management strategy of the group is set out
in the Statement of Compliance with the Quoted Companies Alliance (“QCA”) Corporate Governance Code
(the “QCA Code”) (Principles 1 and 4) on pages [20-22].
Interest of Employees;
The Group has a very limited number of employees, and all have direct access to the Executive Directors on a
daily basis and to the Chairman, if necessary. The Group has a formal Employees’ Policy manual which includes
process for confidential report and whistleblowing.
Need to foster the Company’s business relationships with suppliers/customers and others;
The nature of the Group’s business is such that the majority of its business relationships are with joint venture
partners, the boards of directors of the companies in which the Group has strategic stakes to the extent that
such relationships are permitted, and with suppliers for services. As the success of the business primarily
depends on its relationship with its partners and investees, the Executive Directors manage these
relationships on a day-to-day basis. Where possible, the Group will take a board, or similar appointment, in
strategic investees to ensure that there is a close and successful ongoing dialog between the parties. Service
providers are paid within their payment terms and the Group aims to keep payment periods under 30 days
wherever practical.
Impact of the Company’s operations on the community and environment;
The Group takes its responsibility within the community and wider environment seriously. Its approach to its
social responsibilities is set out in the Statement of Compliance with the QCA Code (Principle 3) on page [21].
CADENCE MINERALS PLC
STRATEGIC REPORT
For the year ended 31 December 2024
15
DIRECTORS’ SECTION 172 STATEMENT (CONTINED)
The desirability of the Company maintaining a reputation for high standards of business conduct;
The Directors are committed to high standards of business conduct and governance and have adopted the
QCA Code which is set out on pages [20 to 25]. Where there is a need to seek advice on particular issues, the
Board will consult with its lawyers and nominated advisors to ensure that its reputation for good business
conduct is maintained.
The need to act fairly between members of the Company;
The Board’s approach to shareholder communication is set out in the Statement of Compliance with the
(Principle 2) on page [21]. The Company aims to keep shareholders fully informed of significant developments
in the Group’s progress. Information is disseminated through Stock Exchange announcements, website
updates and, where appropriate video/web casts. During the year the Company issued various RNS and videos
to update shareholders. All information is made available to all shareholders at the same time and no
individual shareholder, or group of shareholders, is given preferential treatment.
CADENCE MINERALS PLC
REPORT OF THE DIRECTORS
For the year ended 31 December 2024
16
REPORT OF THE DIRECTORS
The Directors present their annual report together with the audited financial statements of the Company for
the Year Ended 31 December 2024.
Principal activity
The Company is an investment entity. The principal activity of the Company is that of holding assets involved
in the identification, investment and development of mineral resources.
Domicile and principal place of business
Cadence Minerals plc is domiciled in the United Kingdom, which is also its principal place of business.
Business review and Future Development
The results of the Company are shown on page [38].
Results and Dividends
The Directors do not recommend the payment of a dividend (2023: £nil). A review of the performance of the
Company and its future prospects is included in the Strategic Report on pages [1 to 15].
Key Performance Indicators
Due to the current status of the Company, the Board has not identified any performance indicators as key
other than cash management and the carrying value of investments. Having sufficient cash for business
operations is vital and must be managed accordingly. The Directors review and manage the Group’s cash flow
on a monthly basis. The financial strategy is to ensure that, wherever possible, there are sufficient funds to
cover corporate overheads and exploration expenditure for as long a period as possible. Management has
confidence that financing of the Company can continue as and when required, albeit the board is keen to avoid
excessive dilution and will manage the financing process with that objective in mind. Investments are closely
managed and monitored; further details are included in the Chairman’s statement.
The monitoring and management of the carrying value of investments are specified on pages [1 to 11].
Furthermore, the Company has ensured that where possible it has built operational flexibility in its corporate
and exploration expenditure to be paused should the financing environment prove difficult and cash
preservation prove essential.
Principal risks and uncertainties
The principal risks and uncertainties facing the Company involve are specified on pages [12 to 13].
Financial risk management objectives and policies
The Company’s principal financial instruments are available for sale assets, trade receivables, trade payables,
loans and cash at bank. The main purpose of these financial instruments is to fund the Company's operations.
It is, and has been throughout the period under review, the Company’s policy that no trading in financial
instruments shall be undertaken. The main risks arising from the Company’s financial instruments are liquidity
risk and interest rate risk. The Board reviews and agrees policies for managing each of these risks and they are
summarised below. Further information is available in Note [12].
Liquidity risk
The Company's objective is to maintain a balance between continuity of funding and flexibility through the
use of equity and its cash resources. Further details of this are provided in the principal accounting policies,
headed 'going concern' and Note [12] to the financial statements.
CADENCE MINERALS PLC
REPORT OF THE DIRECTORS
For the year ended 31 December 2024
17
Interest rate risk
The Company only has borrowings at fixed coupon rates and therefore minimal interest rate risk, as this is
deemed its only material exposure thereto. The Company seeks the highest rate of interest receivable on its
cash deposits whilst minimising risk.
Market risk
The Company is subject to market risk in relation to its investments in listed Companies held as available for
sale assets.
Foreign exchange risk
The Company operates foreign currency bank accounts to help mitigate the foreign currency risk, and currently
has little exposure except through its investments.
Political Donations and Expenditure
No charitable or political contributions were made during the current or previous year.
Directors
The membership of the Board is set out below. All directors served throughout the period unless otherwise
stated.
Andrew Suckling
Kiran Morzaria
Donald Strang
Adrian Fairbourn
Substantial shareholdings
Interests in excess of 3% of the issued share capital of the Company which had been notified as at 13 June
2025 were as follows:
Number of
Ordinary shares
held
Percentage of
capital
%
Hargreaves Lansdown (Nominees) Limited (15942)
35,750,606
12.08%
Hargreaves Lansdown (Nominees) Limited (VRA)
25,090,836
8.48%
Interactive Investor Services Nominees Limited (SMKTISAS)
24,752,420
8.36%
James Brearley Crest Nominees Limited (WALPOLE)
21,509,399
7.27%
Barclays Direct Investing Nominees Limited (CLIENT1)
16,146,092
5.46%
HSDL Nominees Limited (MAXI)
15,107,566
5.10%
Hargreaves Lansdown (Nominees) Limited (HLNOM)
13,625,756
4.60%
Interactive Investor Services Nominees Limited (SMKTNOMS)
13,505,477
4.56%
Redmayne (Nominees) Limited (PENSUN)
12,159,873
4.11%
Vidacos Nominees Limited (IGUKCLT)
11,220,107
3.79%
Payment to suppliers
It is the Company's policy to agree appropriate terms and conditions for its transactions with suppliers by
means ranging from standard terms and conditions to individually negotiated contracts and to pay suppliers
according to agreed terms and conditions, provided that the supplier meets those terms and conditions. The
Company does not have a standard or code dealing specifically with the payment of suppliers.
Trade payables at the year end all relate to sundry administrative overheads and disclosure of the number of
days purchases represented by year end payables is therefore not meaningful.
CADENCE MINERALS PLC
REPORT OF THE DIRECTORS
For the year ended 31 December 2024
18
Events after the Reporting Period
Events after the Reporting Period are outlined in Note [15] to the Financial Statements.
Going concern
The Directors have prepared cash flow forecasts for the period ending 30 June 2026 which take account of the
current cost and operational structure of the Company, as described further on page [43].
The cost structure of the Company comprises a high proportion of discretionary spend and therefore in the
event that cash flows become constrained, costs can be quickly reduced to enable the Company to operate
within its available funding.
These forecasts demonstrate that the Company has sufficient cash funds available to allow it to continue in
business for a period of at least twelve months from the date of approval of these financial statements.
Accordingly, the financial statements have been prepared on a going concern basis.
CADENCE MINERALS PLC
REPORT OF THE DIRECTORS
For the year ended 31 December 2024
19
DIRECTORS’ RESPONSIBILITIES STATEMENT
The Directors are responsible for preparing the Annual Report and the financial statements in accordance with
applicable law and regulations.
Company law requires the Directors to prepare financial statements for each financial year. Under that law
the Directors have elected to prepare the Company financial statements in accordance with UK adopted
International Accounting Standards (IAS). Under company law the Directors must not approve the financial
statements unless they are satisfied that they give a true and fair view of the state of affairs and profit or loss
of the Company for that period. In preparing these financial statements, the Directors are required to:
- select suitable accounting policies and then apply them consistently;
- make judgements and estimates that are reasonable and prudent;
- state whether applicable IFRSs have been followed, subject to any material departures disclosed and
explained in the financial statements;
- prepare the financial statements on the going concern basis unless it is inappropriate to presume that the
Company will continue in business.
The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain
the Company's transactions and disclose with reasonable accuracy at any time the financial position of the
Company and enable them to ensure that the financial statements comply with the Companies Act 2006. They
are also responsible for safeguarding the assets of the Company and hence for taking reasonable steps for the
prevention and detection of fraud and other irregularities.
In so far as each of the Directors are aware:
• there is no relevant audit information of which the Company's auditors are unaware; and
• the Directors have taken all steps that they ought to have taken to make themselves aware of any relevant
audit information and to establish that the auditors are aware of that information.
The Directors are responsible for the maintenance and integrity of the corporate and financial information
included on the Company's website. Legislation in the United Kingdom governing the preparation and
dissemination of financial statements may differ from legislation in other jurisdictions.
Auditors
PKF Littlejohn LLP offer themselves for re-appointment as auditor in accordance with Section 489 of the
Companies Act 2006.
ON BEHALF OF THE BOARD
Kiran Morzaria
Chief Executive Officer, 18 June 2025
CADENCE MINERALS PLC
CORPORATE GOVERNANCE
For the year ended 31 December 2024
20
CORPORATE GOVERNANCE
Introduction to Governance
The Directors recognise that good corporate governance is a key foundation for the long-term success of the
Company. As the Company is listed on the AIM market of the London Stock Exchange and it is subject to the
continuing requirements of the AIM Rules. The Board has therefore adopted the principles set out in the
Corporate Governance Code for small and midsized companies published by the Quoted Companies Alliance
(“QCA Code”). The principles are listed below.
While building a strong governance framework, we also try to ensure that we take a proportionate approach
and that our processes remain fit for purpose as well as embedded within the culture of our organisation. We
continue to evolve our approach and make ongoing improvements as part of building a successful and
sustainable company.
In November 2023 a revised QCA code was released, the key updates include:
•
Wider Stakeholder Interests: Enhanced focus on ESG responsibilities and stakeholder engagement
(Principle 4).
•
Board Composition: Stricter requirements for board independence and diversity (Principles 6 and 7).
•
Succession Planning: Emphasis on clear succession strategies (Principle 8).
•
Remuneration Policy: New guidelines to align remuneration with long-term value creation (Principle
9).
As is permitted by the guidance set out by the QCA, the transitionary period of 12 months following 1 April
2024 is being utilised to put in place measures to embrace the key updates to the QCA code where possible.
1. Establish a strategy and business model which promote long-term value for shareholders
Our strategy is to identify undervalued assets with irreplaceable strategic advantages that will deliver capital
growth to our shareholders. We invest in these assets and where required help deliver capital growth. To meet
long-term demand, we believe the metals and mining sectors require focused investment capital from
knowledgeable investors that understand the substantial risk of the mineral resource sector and how to
mitigate these risks to maximise potential returns for our investors.
A more detailed description of its Strategy and Business Model is available on page [1]. Details on the principal
risks and uncertainties which the Company faces are specified on pages [12 to 13]. The Company seeks to
share this vision and details of the implementation of its strategy through internal dialogue with employees
as well as external communications by way of public announcements and dissemination of information
through this website and the annual report and accounts.
CADENCE MINERALS PLC
CORPORATE GOVERNANCE
For the year ended 31 December 2024
21
2. Seek to understand and meet shareholder needs and expectations
The Board is committed to maintaining an open dialogue with shareholders. Communication with the Board
is committed to maintaining an open dialogue with shareholders. Communication with shareholders is
coordinated by the CEO. Cadence encourages two-way communication with institutional and private
investors. The Company’s major shareholders maintain an active dialogue and ensure that their views are
communicated fully to the Board. Where voting decisions are not in line with the Company’s expectations the
Board will engage with those shareholders to understand and address any issues. The Company Secretary is
the main point of contact for such matters.
The Company seeks out appropriate platforms to communicate to a broad audience its current activities,
strategic goals and broad view of the sector and other related issues. This includes but is not limited to media
interviews, website videos in-person investor presentations and written content. Communication to all
stakeholders is the direct responsibility of the Senior Management team. Managers work directly with
professionals to ensure all inquiries (through established channels for this specific purpose such as email or
phone) are addressed in a timely matter. Managers also ensure that the Company communicates with clarity
on its proprietary internet platforms. The Board routinely reviews the Company communication policy and
programmes to ensure the quality communication with all stakeholders.
The Board believes that the Annual Report and Accounts, and the Interim Report published at the half-year
which can be found on the Company’s website, play an important part in presenting all shareholders with an
assessment of the Company’s position and prospects. All reports and press releases are published under the
“Investors” tab of the Company’s website.
3. Take into account wider stakeholder and social responsibilities and their implications for long-term
success
The Board recognises its prime responsibility under UK corporate law is to promote the success of the
Company for the benefit of its members as a whole. The Board also understands that it has a responsibility
towards employees, partners, customers, suppliers and to the community and environment it operates in as
a whole.
Communication with and feedback from these various groups is achieved in a variety of ways. The Executive
Directors hold investor roadshows and webcasts on a regular basis, at which feedback from shareholders is
sought. Regular dialogue is maintained with employees through regular discussion and updates given by the
Executive Directors.
The nature of the Cadence’s business as an investment company means that although it has no direct effect
on the working environments and communities of the companies it invests in, it nonetheless liaises with the
management of its investee companies to understand their approach to stakeholder engagement and their
policies, which will form part of its investment criteria.
CADENCE MINERALS PLC
CORPORATE GOVERNANCE
For the year ended 31 December 2024
22
4. Embed effective risk management, considering both opportunities and threats, throughout the
organisation
The Board has an established Audit Committee, a summary of its roles and responsibilities is available on the
corporate governance webpage. The Committee is specifically charged with ensuring that Cadence as a whole
has the appropriate policies and processes in place to identify the risks which the Company is exposed to and
to proactively mitigate those risks as appropriate.
The Company maintains a register of risks and publishes an overview of significant risks and uncertainties in
its Annual Report. Please refer to the Company’s Annual Report and Accounts for further details on the
principal risks and uncertainties which the Company faces.
The Company receives regular feedback from its external auditors on the state of its internal controls. The
Board maintains a register of risks and publishes an annual summary of the significant risks and uncertainties
in the Annual Report.
5. Maintain the Board as a well-functioning, balanced team led by the chair
The Board is comprised of Andrew Suckling the Non-Executive Chairman, a Non-Executive Director and two
Executive Directors. The CEO, Kiran Morzaria, is engaged to work a minimum of a 27-hour week and is an
employee of the Company. The Finance Director, Donald Strang, is engaged to work a minimum of a 27-hour
week.
The Board deemed that given the stage and development of the Company, it would be more cost efficient to
employ a full-time accountant which along with the finance director ensure that Company’s financial systems
are robust, compliant, and support current activities and future growth.
The service agreements of the Non-Executive Directors anticipate that the Non-Executive Chairman should
spend 5 working days per month and the Non-Executive Director 3 working days per month. All Directors
dedicate such time as required to effectively perform their roles.
The roles of the Chairman and CEO are clearly separated. The Directors ensure the skills required to undertake
their roles are kept current through training and consultation with subject matter experts as required.
The CEO is responsible for the operational management of the business of Cadence and for the
implementation of strategy and policies as agreed by the Board. The non-executive Chairman is responsible
for the leadership and effective working of the Board, for setting the Board agenda, and ensuring that Directors
receive accurate, timely and clear information.
The CEO is responsible for the operational management of the business of Cadence and for the
implementation of strategy and policies as agreed by the Board. The Non-Executive Chairman is responsible
for the leadership and effective working of the Board, for setting the Board agenda, and ensuring that Directors
receive accurate, timely and clear information.
The Non-Executive Directors are not considered independent under the FRC Code as they hold options in the
Company. However, the Board considers that the Non-Executive Directors are independent of management
under all other measures and are able to exercise independence of judgement. Whilst conflicts of interest are
fully disclosed and understood, as appropriate Non-Executive Directors exercise independence of judgement.
CADENCE MINERALS PLC
CORPORATE GOVERNANCE
For the year ended 31 December 2024
23
5.
Maintain the board as a well-functioning, balanced team led by the chair (continued)
No Director is involved in discussions or decisions where he has a conflict of interest. An Audit Committee and
a Remuneration Committee support the Board.
Cadence intends that the Board endeavours to hold full board meetings at least 3 times each year. The
attendance of Board members for meetings during the current financial year is as follows:
Andrew Suckling 7 of 8
Adrian Fairbourn 6 of 8
Kiran Morzaria
8 of 8
Donald Strang
8 of 8
6. Ensure that between them the directors have the necessary up-to-date experience, skills and
capabilities
Directors who have been appointed to the Company have been chosen because of the skills and experience
they offer. The Board continually strives to ensure that it has the right balance of knowledge, skills, experience
and contacts across the sectors in which it operates. This is evaluated in line with Cadence’s business model
as it changes.
It is of primary importance that the Board’s knowledge is kept up to date in a rapidly changing mining and
metals marketplace. This is achieved by maintaining a broad network of contacts across the industry and
ensuring regular dialogue is held and feedback obtained by both the executive and non-executive directors as
appropriate.
As necessary, Directors receive externally provided refresher and update training specific to their individual
roles.
The Company Secretary advises the Board members on their legal and corporate responsibilities and matters
of corporate governance.
Biographical details of each of the Directors are given on page [26] and the website.
7. Evaluate board performance based on clear and relevant objectives, seeking continuous improvement
On 28 September 2018, the Company adopted the QCA Code. Prior to this point, given the nature and the
development of the Company, it did not set Key Performance Indicators.
The Company now measures its performance, and therefore, inherently, the performance of the Board as a
unit, against Key Performance Indicators. Given the significance of the Amapa project its development has
become our primary Key Performance Indicator.
The performance of the Executive Directors is monitored and regularly reviewed by the Non-Executive
Directors. Such review considers both the KPIs outlined above, The Board intends to introduce qualitative
performance measurements for the Executive Directors to ensure that the right degree of focus is applied to
the strategic direction as well as the current financial performance of the business.
CADENCE MINERALS PLC
CORPORATE GOVERNANCE
For the year ended 31 December 2024
24
8. Promote a corporate culture that is based on ethical values and behaviours
The Company has a strong ethical culture, which is promoted by the actions of the Board and Executive team.
These include the following key policies which govern its ethical culture.
•
Equal opportunities policy
•
Code of conduct
•
Whistleblowing policy
•
Health and safety policy
•
Email and internet policy
•
Social media policy
The Company has an anti-bribery policy and has implemented adequate procedures described by the Bribery
Act 2010. The Company reports on its compliance to the Board on an annual basis. The Company has
undertaken a review of its requirements under the General Data Protection Regulation, implementing
appropriate policies, procedures and training to ensure it is compliant.
9. Communicate how the company is governed and is performing by maintaining a dialogue with
shareholders and other relevant stakeholders
The Company encourages two-way communication with both its institutional and private investors and
responds quickly to all significant queries received. The “Investors” tab of our website contains all required
regulatory information together with other information which shareholders may find useful.
The AGM is an important forum for shareholder engagement, and the directors are always available
immediately after the AGM to listen to the views of any shareholders in attendance and to provide them with
an update on the business.
10. Maintain governance structures and processes that are fit for purpose and support good decision-
making by the board
Details of the Company’s corporate governance arrangements are provided within this Corporate Governance
section of the Annual Report and Accounts. The Board considers the appropriateness of these arrangements
against the size and complexity of the Company as it evolves over time.
The Chairman leads the Board and is responsible for ensuring its effectiveness in all aspects of its role. The
Chairman promotes a culture of openness and debate, in particular by ensuring the Non-Executive Directors
provide constructive challenge to the Executive Directors.
The matters reserved for the board are:
•
Definition of the strategic goals for the Company, sets corporate objectives to enable the goals to be met,
and measures performance against those objectives;
•
Ensuring that the necessary financial and human resources are in place to both meet its obligations to all
stakeholders and to provide a platform for profitable growth;
•
Recommending any interim and final dividends;
•
Approving all mergers and acquisitions and all capital expenditure greater than £200,000;
CADENCE MINERALS PLC
CORPORATE GOVERNANCE
For the year ended 31 December 2024
25
10. Maintain governance structures and processes that are fit for purpose and support good decision-
making by the board (continued)
The matters reserved for the board are (continued):
•
Receiving recommendations from the Audit Committee in relation to the reporting requirements and the
appropriate accounting policies for the Company, the appointment of auditors and their remuneration,
and the identification and management of risk;
•
Receives recommendations from the Appointments Committee concerning the appointment of executive
directors, and from the Remuneration Committee concerning the remuneration of the executive directors;
•
Determination of the fees paid to the Non-Executive Directors.
The CEO has the overall responsibility for creating, planning, implementing, and integrating the strategic
direction of the Company. This includes responsibility for all components and departments of a business. The
CEO also ensures that the organisation’s leadership maintains constant awareness of both the external and
internal competitive landscape, opportunities for expansion, customer base, markets, new industry
developments and standards.
The Finance Director works alongside the CEO and has overall control and responsibility for all financial aspects
of company strategy. The Finance Director takes overall responsibility of the Company’s accounting function
and ensures that Company’s financial systems are robust, compliant and support current activities and future
growth. The Finance Director will co-ordinate corporate finance and manage company policies regarding
capital requirements, debt, taxation, equity and acquisitions as appropriate.
The Board is supported by two committees being the Audit Committee and Remuneration Committee. The
Audit Committee advises the Board on the reporting requirements and the appropriate accounting policies for
the Company, the appointment of auditors and their remuneration, and the identification and management
of risk. The Remuneration Committee advises the Board on all matters pertaining to the remuneration of the
Executive Directors.
CADENCE MINERALS PLC
CORPORATE GOVERNANCE
For the year ended 31 December 2024
26
BOARD MEMBERS
The Board comprises of a Non-Executive Chairman, one Non-Executive Director and two Executive Directors.
Andrew Suckling, Non-Executive Chairman
Andrew has over 25 years’ experience in the commodity industry. He began in 1994 as a trader on the London
Metal Exchange and subsequently became a founding partner, research analyst and trader with the multi-
billion fund management group Ospraie. Andrew is a graduate of Brasenose College, Oxford University,
earning a BA (Hons) in Modern History in 1993 and an MA in Modern History in 2000. Andrew is the chair of
the Audit and Remuneration Committee.
Kiran Morzaria, Chief Executive Officer
Kiran holds a B.Eng. from the Camborne School of Mines and an MBA (Finance). He has over 20 years’
experience in the mineral resource industry, working in both operational and management roles. The first four
years of his career were spent in exploration, mining and civil engineering, after which he was involved in the
acquisition, recommissioning and eventual sale of the Vatukoula Gold Mine.
Donald Strang, Finance Director
Donald is a member of the Australian Institute of Chartered Accountants and has over 20 years of experience
in both publicly listed and private enterprises in Australia, Europe and Africa. He has considerable corporate
and international expertise, and over the past decade, has focused on mining and exploration activities.
Adrian Fairbourn, Non-Executive Director
Adrian began his career as an investment analyst before moving to build and manage the highly successful
alternative fund-of-funds operation at the Bank of Bermuda. Adrian has co-managed a multi-family office in
London, responsible for hedge fund investments, direct investments and also asset-raising for co-investment
opportunities. He has successfully assisted in over $US1 billion of structuring, capital and fundraising projects
for private companies and alternative funds. Adrian is a member of the Audit and Remuneration Committee.
CADENCE MINERALS PLC
CORPORATE GOVERNANCE
For the year ended 31 December 2024
27
The Board is responsible for formulating, reviewing and approving the Company’s strategy, financial activities
and operating performance. Day-to-day management is devolved to the Executive Directors, who are charged
with consulting the Board on all significant financial and operational matters. The Board retains ultimate
accountability for governance and is responsible for monitoring the activities of the executive team.
The roles of Chairman and Chief Executive Officer are split in accordance with best practice. The Chairman has
the responsibility of ensuring that the Board discharges its responsibilities. The Chairman is responsible for the
leadership and effective working of the Board, for setting the Board agenda, and ensuring that Directors
receive accurate, timely and clear information. No one individual has unfettered powers of decision.
The two Executive Directors are comprised of a Chief Executive Officer (“CEO”) and Finance Director. The CEO
has the overall responsibility for creating, planning, implementing, and integrating the strategic direction of
the Company. This includes responsibility for all components and departments of a business. The CEO also
ensures that the organisation’s leadership maintains constant awareness of both the external and internal
competitive landscape, opportunities for expansion, customer base, markets, new industry developments and
standards.
The non-executive directors are not considered independent under the Financial Reporting Council’s
Corporate Governance Code (April 2016) (“FRC Code”) as they both have options in the Company. However,
the Board considers that both non-executives are independent of management under all other measures and
able to exercise independence of judgement.
The Committees
Audit Committee
The Audit Committee consists of two non-executive members of the board and meet at least once a year.
The principal duties and responsibilities of the Audit Committee include:
•
Overseeing the Company’s financial reporting disclosure process; this includes the choice of
appropriate accounting policies
•
Monitor the Company’s internal financial controls and assess their adequacy
•
Review key estimates, judgements and assumptions applied by management in preparing published
financial statements
•
Assess annually the auditor’s independence and objectivity
•
Make recommendations in relation to the appointment, re-appointment and removal of the
company’s external auditor
Remuneration Committee
The Remuneration Committee consists of two non-executive members of the board and meet at least once a
year.
The principal duties and responsibilities of the Remuneration Committee include:
•
Setting the remuneration policy for all Executive Directors
•
Recommending and monitoring the level and structure of remuneration for senior management
•
Approving the design of, and determining targets for, performance related pay schemes operated by
the company and approve the total annual payments made under such schemes
•
Reviewing the design of all share incentive plans for approval by the Board and shareholders
CADENCE MINERALS PLC
CORPORATE GOVERNANCE
For the year ended 31 December 2024
28
•
None of the Committee members have any personal financial interest (other than as shareholders and
option holders), conflicts of interest arising from cross-directorships or day-to-day involvement in the
running of the business. No director plays a part in any financial decision about his or her own
remuneration.
Principle and Approach of the Board
Cadence is committed to achieve and maintain high standards of governance. As such, the Board has chosen
to adopt the Quoted Companies Alliance Corporate Governance Code for Small and Mid-Size Quoted
Companies 2018 (“the QCA Code”). Detailed below is how the Board applies the 10 principles of Corporate
Governance, which form part of the QCA code.
Internal Controls
The Directors acknowledge their responsibility for the Company’s systems of internal controls and for
reviewing their effectiveness. These internal controls are designed to safeguard the assets of the Company
and to ensure the reliability of financial information for both internal use and external publication. While they
are aware that no system can provide absolute assurance against material misstatement or loss, in light of
increased activity and further development of the Company, continuing reviews of internal controls will be
undertaken to ensure that they are adequate and effective.
Risk Management
The Board considers risk assessment to be important in achieving its strategic objectives. There is a process of
evaluation of performance targets through regular reviews by Senior Management to forecasts. Project
milestones and timelines are reviewed regularly.
Business Risk
The Board regularly evaluates and reviews any business risks when reviewing project timelines. The types of
risks reviewed include:
•
regulatory and compliance obligations
•
environmental requirements
•
commodity price, interest rate, liquidity and volatility risks
•
political and country risks where appropriate.
Insurance
The Company maintains insurance in respect of its Directors and Officers against liabilities in relation to the
Company.
Treasury Policy
The Company finances its operations through equity and holds its cash as a liquid resource to fund the
obligations of the Company. Decisions regarding the management of these assets are approved by the Board.
Securities Trading
The Board has adopted a Share Dealing Code that applies to Directors, Senior Management and any employee
who is in possession of ‘inside information’. All such persons are prohibited from trading in the Company’s
securities if they are in possession of ‘inside information’. Subject to this condition and trading prohibitions
applying to certain periods, trading can occur provided the individual has received the appropriate prescribed
clearance.
CADENCE MINERALS PLC
REPORT ON REMUNERATION
For the year ended 31 December 2024
29
Report on Remuneration
On behalf of the Board, I am pleased to present the Directors’ Remuneration Report summarising the
Company’s remuneration policy and providing information on the Company’s remuneration approach and
arrangements for Executive Directors, Non-Executive Directors and Senior Executive Management for the year
ended 31 December 2024.
This report is prepared in accordance with the QCA Remuneration Committee Guide for small and mid-sized
quoted companies, revised in 2020. A summary of the Remuneration Committee’s role, membership and
relevant qualifications can be found in the corporate governance section.
Remuneration Committee meetings are held at least once a year with the primary focus of setting goals for
the coming period and then assessing results at the end of that period. During the year, the Remuneration
Committee met 2 times and;
•
Benchmarked the Boards Remuneration, both fixed and variable and as a whole, and compared it to
AIM-listed companies of a similar market capitalisation.
•
Reviewed the above comparisons and establish short, medium and long-term incentive schemes,
which it then recommended to the Board for approval,
•
Reviewed the performance of the Board against targets and awarded incentives covering the reporting
period.
The Board recognises that Directors' remuneration is of legitimate concern to the shareholders. The Company
operates within a competitive environment; performance depends on the individual contributions of the
Directors and employees, and it believes in rewarding vision and innovation.
Policy on executive Directors' Remuneration
The policy of the Board is to provide executive remuneration packages designed to attract, motivate and retain
Directors of the calibre necessary to maintain the Company's position and to reward them for enhancing
shareholder value and return. It aims to provide sufficient levels of remuneration to do this but to avoid paying
more than is necessary. The remuneration will also reflect the Directors' responsibilities and contain
incentives to deliver the Company's objectives.
Salary and Fees
Benchmarking data indicate that, at the time of the review, Cadence's salary and fees are at the median
remuneration for an exploration and mining company with a market capitalisation between £5 million and £10
million on the AIM market.
Share Awards (Share Incentive Plan)
Under the Share Incentive Plan established in September 2014, the Company has maintained an Employee
Benefit Trust (“EBT”) to provide ongoing incentives to the Board. No new Ordinary Shares were issued under
the EBT during the year ended 31 December 2024 (2023: nil).
Pensions
The Company only operates a basic pension scheme for its directors and employees as required by UK
legislation. The Company made the following pension contributions in the year: K Morzaria £3,669 (2023:
£4,403).
Benefits in kind
No benefits in kind were paid during the year to 31 December 2024 or the year ended 31 December 2023.
CADENCE MINERALS PLC
REPORT ON REMUNERATION
For the year ended 31 December 2024
30
Notice periods
Andrew Suckling, Kiran Morzaria, Donald Strang and Adrian Fairbourn each have a 12 month rolling notice
period.
Share option incentives
At 31 December 2024 each Director held 1,800,000 (31 December 2023: 1,800,000) options which are
exercisable at any time before 30 April 2026. The exercise price is 29p. No options were exercised by Directors
during the period (2023: None).
The remuneration of the Directors was as follows:
A Fairbourn
A Suckling
K Morzaria
D Strang
Total
£
£
£
£
£
Year to 31
December 2024
Salary
-
-
172,500
-
172,500
Fees
48,000
120,000
-
120,000
288,000
Total
48,000
120,000
172,500
120,000
460,500
Year to 31
December 2023
Salary
-
-
230,000
-
230,000
Fees
48,000
120,000
-
120,000
288,000
Total
48,000
120,000
230,000
120,000
518,000
At 31 December 2024 £142,000 (2023: £58,000)was outstanding to directors.
The high and low share price for the year were 5.75p and 1.60p respectively (year ended 31 December 2023:
16.625p and 4.85p). The share price at 31 December 2024 was 1.65p (31 December 2023: 5.75p).
Andrew Suckling
Non-Executive Chairman, 18 June 2025
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF CADENCE MINERALS PLC
31
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF CADENCE MINERALS PLC
Opinion
We have audited the financial statements of Cadence Minerals Plc (the ‘company’) for the year ended 31 December
2024 which comprise the Statement of Comprehensive Income, the Statement of Financial Position, the Statement
of Changes in Equity, the Statement of Cash Flows and notes to the financial statements, including significant
accounting policies. The financial reporting framework that has been applied in their preparation is applicable law
and UK-adopted international accounting standards.
In our opinion, the financial statements:
•
give a true and fair view of the state of the company’s affairs as at 31 December 2024 and of its loss for the
year then ended;
•
have been properly prepared in accordance with UK-adopted international accounting standards; and
•
have been prepared in accordance with the requirements of the Companies Act 2006.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable
law. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit
of the financial statements section of our report. We are independent of the company in accordance with the
ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical
Standard as applied to listed entities, and we have fulfilled our other ethical responsibilities in accordance with
these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a
basis for our opinion.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the directors' use of the going concern basis of
accounting in the preparation of the financial statements is appropriate. Our evaluation of the directors’
assessment of the company’s ability to continue to adopt the going concern basis of accounting included
•
Obtaining and evaluating management's going concern assessment, including their assumptions, key
risks and uncertainties, and any available supporting documentation.
•
Assessing the historical forecasting accuracy and consistency of the going concern assessment with
information obtained from other areas of the audit, such as our audit procedures on management's
impairment assessments.
•
Testing the clerical accuracy of the assessment
•
Evaluating whether the assumptions made by management are reasonable and appropriately
conservative, considering the Group's relevant principal risks and uncertainties. We challenged the
assumptions and estimates made by management where necessary.
•
Evaluating the adequacy of working capital, including assessing the reasonableness of assumptions used
in the cash flow forecasts and budgets and any plans to address potential shortfalls.
•
Performing sensitivity analysis on management's assumptions, including applying incremental adverse
cash flow sensitivities to assess the potential impact of severe but plausible scenarios such as significant
movement in prices level 1 investments.
Based on the work we have performed, we have not identified any material uncertainties relating to events or
conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a
going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the
relevant sections of this report.
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF CADENCE MINERALS PLC
32
Our application of materiality
The scope of our audit was influenced by our application of materiality. The quantitative and qualitative thresholds
for materiality determine the scope of our audit and the nature, timing and extent of our audit procedures. The
materiality applied to the financial statements was set at £344,200 (2023: £289,000), with performance materiality
set at £240,900 (2023: £202,300).
Materiality has been calculated as 2% (2023: 2%) of the benchmark of net assets, which we have determined, in
our professional judgement, to be one of the principal benchmarks within the financial statements relevant to
members of the Company in assessing financial performance.
We agreed with the Audit Committee that we would report to them misstatements identified during our audit above
£17,200 (2022: £14,450).
We applied the concept of materiality both in planning and performing the audit, and in evaluating the effect of
misstatement.
Our approach to the audit
In designing our audit, we determined materiality, as above, and assessed the risk of material misstatement in the
financial statements. We addressed the risk of management override of internal controls, including evaluating
whether there was evidence of bias by the directors that represents a risk of material misstatement due to fraud. In
particular we looked at areas involving significant accounting estimates and judgements by the directors and
considered future events that are inherently uncertain, such as the fair value of unquoted investments and the
value of the share options scheme.
In addition, we focused our audit on the significant risk areas including the Key Audit Matter as outlined below.
A full scope audit was performed on the complete financial information of the company
Key audit matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the
financial statements of the current period and include the most significant assessed risks of material misstatement
(whether or not due to fraud) we identified, including those which had the greatest effect on: the overall audit
strategy, the allocation of resources in the audit; and directing the efforts of the engagement team. These matters
were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion
thereon, and we do not provide a separate opinion on these matters.
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF CADENCE MINERALS PLC
33
Key Audit Matter
How our scope addressed this matter
Carrying value of Financial Assets (Refer to note 6)
The company holds investments in quoted and
unquoted private companies amounting to £473k and
£13,329k
respectively.
These
are
valued
in
accordance with IFRS 13 and the fair value hierarchy;
and classified as per IFRS 9.
There is the risk that these investments have not been
valued in accordance with IFRS 13 and IFRS 9 and
require impairment.
Investments which fall under Tier 3 of the fair value
hierarchy are subject to significant management
estimate, which increases the risk of material
misstatement.
The group has also invested in the level 1 listed
investments, which are not subject to management
judgement or estimation, and are valued at their
yearend share price per the relevant exchange.
Given the value of the investment is material at the
year end and significant judgement needed when
valuing level 3 investment we have assessed valuation
of investments as a key audit matter.
Our audit work included:
•
Ensuring that Cadence Minerals Plc has full title
to the investments held;
•
Reviewing the valuation methodology for the
investments held and ensuring that the carrying
values are recoverable supported by sufficient
and appropriate audit evidence;
•
Reviewing the movement in investments to
ensure they are accounted for and disclosed
correctly in line with IFRS 9;
•
Ensuring that all asset types are categorised
according to IFRS, including the accounting
disclosures as required under IFRS 9;
•
Reviewing disclosures in relation to said assets;
•
Ensuring that appropriate disclosures
surrounding the estimates made in respect of any
valuations are included in the financial
statements; and
•
Considering whether the transactions have been
accounted for correctly within the financial
statements.
The Group has applied for various licences with a view
of obtaining a mining permit on the Amapa project
which will allow it to move towards production. While
the Group has sufficient funds to meet its current
working capital needs for a period of 12 months from
the date of this report, external funding will be required
to advance the Amapa project towards production once
the necessary licences and the mining permit is
approved. This external funding still needs to be
finalised and Management are looking at various
options, including a multi-staged investment raise
which will allow production to commence and increase
over time, or a joint arrangement with interested parties.
The Directors remain confident in management’s ability
to secure financing. Further details of this can be
reviewed in the strategic report.
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF CADENCE MINERALS PLC
34
Carrying
value
and
classification
of
loans
receivable from Investee (refer to note 7)
The company has loan receivables from investees of
£3.9m as at 31 December 2024. There is a risk that the
loan amounts are not recoverable given that no
repayments were made by the debtors for the loans
outstanding.
There is also a risk that the loans have not been
accounted for in accordance with IFRS 9.
Risk has been assessed as a Key Audit Matter due to
the uncertainty, significant judgement and estimates
associated with the recoverability of £3.9 million in
loans from REM Mexico. The balance has not moved
since the previous year.
Disputes are ongoing with the Mexican government
under the UK-Mexico Bilateral Investment Treaty
around the project on the Sonara site with no
conclusion yet. It is possible that this amount is not
recoverable if this situation is not resolved.
Our audit work included:
•
Ensuring that the loans have been classified and
disclosed correctly in accordance with IFRS 9;
•
Discussing with Management to ascertain their
justification for no IFRS 9 ECL charge being
recognised in the year. Challenge management's
key assumptions and consider whether the loans
are fully recoverable or whether an IFRS 9 ECL
charge is required; and
•
Ensuring that the loans are correctly classified as
current or non-current in accordance with the
payment terms per the loan agreements.
Cadence holds an interest in the Sonora Lithium Project
through REM Mexico, which has a 30% stake in the joint
venture interests in Mexalit S.A. de CV ("Mexalit") and
Megalit S.A. de CV ("Megalit"). The remaining 70% is held
by Ganfeng Lithium Group Co., Ltd ("Ganfeng")
Following a change in the Mexican Mining Law and the
submission of evidence to support the investment
spend to the regulatory authorities, a preliminary
cancellation of nine lithium concessions was issued in
August 2024. The cancellations are not final and both
Ganfeng and Cadence have filed administrative review
recourses before the Secretary of Economy against the
resolutions cancelling the concessions, as they believe
these resolutions violate Mexican and international law
and infringe upon their fundamental due process rights.
The case is still ongoing and the recovery of these loans
from REM Mexico is dependent on the success of the
administrative review. If the concessions are not
granted back and compensation is not received from
the Mexican government for concessions, a full
impairment of the loan may be required. Further details
are disclosed in the critical accounting estimates of
these financial statements.
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF CADENCE MINERALS PLC
35
Other information
The other information comprises the information included in the annual report, other than the financial statements
and our auditor’s report thereon. The directors are responsible for the other information contained within the
annual report. Our opinion on the financial statements does not cover the other information and, except to the
extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our
responsibility is to read the other information and, in doing so, consider whether the other information is materially
inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise
appears to be materially misstated. If we identify such material inconsistencies or apparent material
misstatements, we are required to determine whether this gives rise to a material misstatement in the financial
statements themselves. If, based on the work we have performed, we conclude that there is a material
misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of the audit:
•
the information given in the strategic report and the directors’ report for the financial year for which the
financial statements are prepared is consistent with the financial statements; and
•
the strategic report and the directors’ report have been prepared in accordance with applicable legal
requirements.
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the company and its environment obtained in the course of the
audit, we have not identified material misstatements in the strategic report or the directors’ report.
We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires
us to report to you if, in our opinion:
•
adequate accounting records have not been kept, or returns adequate for our audit have not been received
from branches not visited by us; or
•
the financial statements are not in agreement with the accounting records and returns; or
•
certain disclosures of directors’ remuneration specified by law are not made; or
•
we have not received all the information and explanations we require for our audit.
Responsibilities of directors
As explained more fully in the directors’ responsibilities statement, the directors are responsible for the preparation
of the financial statements and for being satisfied that they give a true and fair view, and for such internal control
as the directors determine is necessary to enable the preparation of financial statements that are free from material
misstatement, whether due to fraud or error.
In preparing the financial statements, the directors are responsible for assessing the company’s ability to continue
as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis
of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic
alternative but to do so.
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF CADENCE MINERALS PLC
36
Auditor’s responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from
material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion.
Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance
with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or
error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence
the economic decisions of users taken on the basis of these financial statements.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures
in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities,
including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is
detailed below:
•
We obtained an understanding of the company and the sector in which it operates to identify laws and
regulations that could reasonably be expected to have a direct effect on the financial statements. We
obtained our understanding in this regard through discussions with management and application of
cumulative audit knowledge and experience of the sector.
•
We determined the principal laws and regulations relevant to the company in this regard to be those arising
from Companies Act 2006, AIM listing rules, GDPR, QCA compliance, International Financial Reporting
Standards (in compliance with the Companies Act 2006) and tax legislation within the United Kingdom.
•
We designed our audit procedures to ensure the audit team considered whether there were any indications
of non-compliance by the company with those laws and regulations. These procedures included, but were
not limited to:
o
Discussions with management
o
Review of board minutes
o
Review of legal and professional expenditure
•
We also identified the risks of material misstatement of the financial statements due to fraud. We
considered, in addition to the non-rebuttable presumption of a risk of fraud arising from management
override of controls, that the potential for management bias was in the valuation of investments. We
addressed the risk by challenging the assumptions and judgements made by management when auditing
that significant accounting estimate.
•
As in all of our audits, we addressed the risk of fraud arising from management override of controls by
performing audit procedures which included, but were not limited to: the testing of journals; reviewing
accounting estimates for evidence of bias; and evaluating the business rationale of any significant
transactions that are unusual or outside the normal course of business.
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those
leading to a material misstatement in the financial statements or non-compliance with regulation. This risk
increases the more that compliance with a law or regulation is removed from the events and transactions reflected
in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is
also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional
concealment, forgery, collusion, omission or misrepresentation.
A further description of our responsibilities for the audit of the financial statements is located on the Financial
Reporting Council’s website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our
auditor’s report.
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF CADENCE MINERALS PLC
37
Use of our report
This report is made solely to the company’s members, as a body, in accordance with Chapter 3 of Part 16 of the
Companies Act 2006. Our audit work has been undertaken so that we might state to the company’s members those
matters we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent
permitted by law, we do not accept or assume responsibility to anyone, other than the company and the company's
members as a body, for our audit work, for this report, or for the opinions we have formed.
Zahir Khaki (Senior Statutory Auditor)
15 Westferry Circus
For and on behalf of PKF Littlejohn LLP
Canary Wharf
Statutory Auditor
London E14 4HD
18 June 2025
CADENCE MINERALS PLC
STATEMENT OF COMPREHENSIVE INCOME
For the year ended 31 December 2024
38
Statement of Comprehensive Income
Year ended
Year ended
Note
31 December 2024
31 December 2023
£’000
£’000
Income
Unrealised loss on financial investments
6
(1,023)
(3,101)
Realised loss on financial investments
6
(1,102)
(2,793)
(2,125)
(5,894)
Share based payments
-
(25)
Impairment of intangibles
(93)
(905)
Loan from subsidiary written off
8
-
4,810
Other administrative expenses
(1,099)
(1,302)
Total administrative expenses
(1,192)
2,578
Operating loss
1
(3,317)
(3,316)
Finance cost
3
(2)
Foreign exchange (loss)/gain
(6)
297
Loss before taxation
(3,325)
(3,019)
Taxation
4
-
-
Loss attributable to the equity holders of the Company
(3,325)
(3,019)
Total comprehensive earnings for the year, attributable to
the equity holders of the company
(3,325)
(3,019)
Earnings per ordinary share
Basic earnings per share (pence)
5
(1.651)
(1.762)
Diluted earnings per share (pence)
5
(1.651)
(1.762)
The accompanying principal accounting policies and notes form an integral part of these financial statements.
CADENCE MINERALS PLC
COMPANY NUMBER 05234262
Statement of Financial Position
As at 31 December 2024
39
STATEMENT OF FINANCIAL POSITITON
31 December 2024
31 December 2023
ASSETS
Note
£'000
£'000
Non-current
Financial Assets
6
13,329
11,660
13,329
11,660
Current
Trade and other receivables
7
3,994
3,937
Financial Assets
6
473
4,162
Cash and cash equivalents
655
215
Total current assets
5,122
8,314
Total assets
18,451
19,974
LIABILITIES
Current
Trade and other payables
8
483
288
Borrowings
9
755
933
Total current liabilities
1,238
1,221
Non-current
Borrowings
9
-
302
Total liabilities
1,238
1,523
EQUITY
Issued share capital
10
3,376
2,226
Share premium
10
38,591
37,654
Share based payment reserve
236
258
Investment in own shares
(64)
(64)
Retained earnings
(24,926)
(21,623)
Equity attributable
17,213
18,451
to equity holders of the Company
Total equity and liabilities
18,451
19,974
The financial statements were approved by the Board on 18 June 2025, and signed on their behalf by;
Kiran Morzaria
Donald Strang
Director
Director
Company number 05234262
The accompanying principal accounting policies and notes form an integral part of these financial statements.
CADENCE MINERALS PLC
STATEMENT OF CHANGES IN EQUITY
As at 31 December 2024
40
STATEMENT OF CHANGES IN EQUITY
Share
capital
Share
premium
Share
based
payment
reserve
Investment
in own
shares
Retained
earnings
Total
equity
£'000
£'000
£'000
£'000
£'000
£'000
Balance at 31 December
2022
2,144
37,612
252
(64)
(18,623)
21,321
Share based payments
-
-
25
-
-
25
Transfer on lapse of
warrants
-
-
(19)
-
19
-
Share issue
82
42
-
-
-
124
Transactions with owners
82
42
6
-
19
149
Loss for the period
-
-
-
-
(3,019)
(3,019)
Total comprehensive
earnings for the period
-
-
-
-
(3,019)
(3,019)
Balance at 31 December
2023
2,226
37,654
258
(64)
(21,623)
18,451
Transfer on lapse of
warrants
-
-
(22)
-
22
-
Share issue
1,150
1,125
-
-
-
2,275
Share issue costs
-
(188)
-
-
-
(188)
Transactions with owners
1,150
937
(22)
-
22
2,087
Loss for the period
-
-
-
-
(3,325)
(3,325)
Total comprehensive
earnings for the period
-
-
-
-
(3,325)
(3,325)
Balance at 31 December
2024
3,376
38,591
236
(64)
(24,926)
17,213
The accompanying principal accounting policies and notes form an integral part of these financial statements.
CADENCE MINERALS PLC
STATEMENT OF CASH FLOWS
For the year ended 31 December 2024
41
STATEMENT OF CASH FLOWS
Year ended
Year ended
31 December 2024
31 December
2023
£'000
£'000
Cash flow from operating activities
Continuing operations
Operating loss
(3,317)
(3,316)
Loss on financial investments
2,125
5,894
Impairment of investments
93
905
Write off of loan from subsidiary
8
-
(4,810)
Equity settled share based payments
-
25
Payments of creditors made in shares
125
-
Decrease in trade and other receivables
18
20
Increase/(decrease) in trade and other payables
136
(29)
Net cash outflow from operating activities from continuing
operations
(820)
(1,311)
Cash flows from investing activities
Payments for non-current financial investments
(1,762)
(2,088)
Receipts on sale of current investments
1,564
2,150
Net cash (outflow)/inflow from investing activities
(198)
62
Cash flows from financing activities
Proceeds from issue of share capital
1,981
-
Share issue costs
(35)
-
Net borrowings
(497)
1,400
Net finance cost
(2)
-
Net cash inflow from financing activities
1,447
1,400
Net change in cash and cash equivalents
429
151
Foreign exchange movements on cash and cash equivalents
11
(46)
Cash and cash equivalents at beginning of period
215
110
Cash and cash equivalents at end of period
655
215
Material non-cash transactions
The material non-cash transactions in 2024 were the payments of creditors made in shares of £125,000 and amounts
deducted from proceeds of share issues for issue costs of £69,000. During the year ended 31 December 2023 the company
received shares in Hastings Technology Metals valued at £5,152,000, and wrote off the loan from Mojito of £4,810,000
which arose on the disposal of its interest in the Yangibana Project, by Mojito.
The accompanying principal accounting policies and notes form an integral part of these financial statements.
CADENCE MINERALS PLC
PRINCIPAL ACCOUNTING POLICIES
For the year ended 31 December 2024
42
PRICIPAL ACCOUNTING POLICIES
GENERAL INFORMATION
Cadence Minerals plc is a company incorporated and domiciled in the United Kingdom. The Company’s shares
were dual listed on AIM of the London Stock Exchange and on the growth market of Aquis Stock Exchange
(AQSE). In April 2024, the company withdrew its ordinary shares from trading on the AQSE Growth Market,
operated by the AQSE in order to improve operational and financial efficiencies.
The Financial Statements are for the year ended 31 December 2024 and have been prepared under the
historical cost convention, except for the measurement to fair value of financial assets, and in accordance with
UK adopted International Accounting Standards (UK-IAS) in conformity with the requirements of the
Companies Act 2006. These Financial Statements (the "Financial Statements") have been prepared and
approved by the Directors on 18 June 2025 and signed on their behalf by Donald Strang and Kiran Morzaria.
The accounting policies have been applied consistently throughout the preparation of these Financial
Statements, and the financial report is presented in Pound Sterling (£) and all values are rounded to the
nearest thousand pounds (£‘000) unless otherwise stated.
INVESTING POLICY
The Company is an investment entity. The Company’s investing policy, which was approved at a General
Meeting on 29 November 2010, is to acquire a diverse portfolio of direct and indirect interests in exploration
and producing rare earth minerals and/or other metals projects and assets (‘Investing Policy’). In light of the
nature of the assets and projects that will be the focus of the Investing Policy, the Company will consider
investment opportunities anywhere in the world.
The Directors have considerable investment experience, both in structuring and executing deals and in raising
funds. Further details of the Directors’ expertise are set out on the Company website. The Directors will use
this experience to identify and investigate investment opportunities, and to negotiate acquisitions. Wherever
necessary, the Company will engage suitably qualified technical personnel to carry out specialist due diligence
prior to making an acquisition or an investment. For the acquisitions that they expect the Company to make,
the Directors may adopt earn-out structures with specific performance targets being set for the sellers of the
businesses acquired and with suitable metrics applied.
The Company may invest by way of outright acquisition or by the acquisition of assets – including the
intellectual property – of a relevant business, partnership or joint venture arrangement. Such investments may
result in the Company acquiring the whole or part of a company or project (which, in the case of an investment
in a company, may be private or listed on a stock exchange, and which may be pre-revenue), and such
investments may constitute a minority stake in the company or project in question. The Company’s
investments may take the form of equity, joint venture, debt, convertible documents, licence rights, or other
financial instruments such as the Directors deem appropriate.
The Company may be both an active and a passive investor depending on the nature of the individual
investments in its portfolio. Although the Company intends to be a long-term investor, the Directors will place
no minimum or maximum limit on the length of time that any investment may be held.
CADENCE MINERALS PLC
PRINCIPAL ACCOUNTING POLICIES
For the year ended 31 December 2024
43
INVESTING POLICY (CONTINUED)
There is no limit on the number of projects into which the Company may invest, or on the proportion of the
Company’s gross assets that any investment may represent at any time, and the Company will consider
possible opportunities anywhere in the world.
The Directors may offer new ordinary shares in the capital of the Company by way of consideration as well as
cash, thereby helping to preserve the Company’s cash for working capital and as a reserve against unforeseen
contingencies including, by way of example and without limit, delays in collecting accounts receivable,
unexpected changes in the economic environment and unforeseen operational problems. The Company may,
in appropriate circumstances, issue debt securities or otherwise borrow money to complete an investment.
There are no borrowing limits in the Articles of Association of the Company. The Directors do not intend to
acquire any cross holdings in other corporate entities that have an interest in the ordinary shares.
GOING CONCERN
The Directors note the losses and cash outflows that the Group has made for the year ended 31 December
2024. The Directors have prepared cash flow forecasts for the period ending 30 June 2026 which take account
of the current cost, operational structure and external funding of the Company. These forecasts prepared
demonstrate that the Company will have sufficient cash funds available to allow it to continue in business for
a period of at least twelve months from the date of approval of these financial statements. Accordingly, the
financial statements have been prepared on a going concern basis.
Notwithstanding the Company’s current cash position and expenditure commitments, the Board remains
mindful of potential unforeseen events beyond its control. Given that a significant proportion of the
Company’s cost structure is discretionary, the Board is confident that, if necessary, it can take prompt and
effective action to address any cash constraints. In such circumstances, the Company will reduce its
expenditure accordingly to ensure continued operation within available funding.
At 31 December 2024 the Company had cash and cash equivalents of £655,000, current financial assets of
£473,000 and £755,000 in borrowings. The borrowings are due to be fully paid by the end of November
2025.The Company would still be able to meet its obligations, without the requirement to cut costs, should
the value of the current listed financial assets be reduced by 65%.
For these reasons the Directors adopt the going concern basis in the preparation of the Financial Statements.
STATEMENT OF COMPLIANCE WITH IAS
The Company’s financial statements have been prepared under the historical cost convention except for the
measurement to fair value of financial assets as described in the accounting policy below, and the financial
statements have been prepared in accordance with UK adopted International Accounting Standards (IAS) in
conformity with the provisions of the Companies Act 2006. The principal accounting policies adopted by the
Company are set out below.
CADENCE MINERALS PLC
PRINCIPAL ACCOUNTING POLICIES
For the year ended 31 December 2024
44
TAXATION
Current income tax assets and/or liabilities comprise those obligations to, or claims from, fiscal authorities
relating to the current or prior reporting period, which are unpaid at the balance sheet date. They are
calculated according to the tax rates and tax laws applicable to the fiscal periods to which they relate, based
on the taxable result for the period. All changes to current tax assets or liabilities are recognised as a
component of tax expense in the income statement.
Deferred income taxes are calculated using the liability method on temporary differences. This involves the
comparison of the carrying amounts of assets and liabilities in the financial statements with their respective
tax bases. In addition, tax losses available to be carried forward as well as other income tax credits to the
Company are assessed for recognition as deferred tax assets.
Deferred tax liabilities are always provided for in full. Deferred tax assets are recognised to the extent that it
is probable that they will be able to be offset against future taxable income. Deferred tax assets and liabilities
are calculated, without discounting, at tax rates that are expected to apply to their respective period of
realisation, provided they are enacted or substantively enacted at the balance sheet date.
Most changes in deferred tax assets or liabilities are recognised as a component of tax expense in the income
statement. Only changes in deferred tax assets or liabilities that relate to a change in value of assets or
liabilities that is charged directly to equity are charged or credited directly to equity.
FINANCIAL ASSETS
The Company's financial assets include cash, other receivables and financial assets. Except for those trade
receivables that do not contain a significant financing component and are measured at the transaction price
in accordance with IFRS 9, all financial assets are initially measured at fair value adjusted for transaction costs
(where applicable).
Financial assets, other than those designated and effective as hedging instruments, are classified into the
following categories:
• amortised cost
• fair value through profit or loss (FVTPL)
• fair value through other comprehensive income (FVOCI).
In the periods presented the corporation does not have any financial assets categorised as FVOCI.
The classification is determined by both:
• the entity’s business model for managing the financial asset
• the contractual cash flow characteristics of the financial asset.
All income and expenses relating to financial assets that are recognised in profit or loss are presented within
finance costs, finance income or other financial items, except for impairment of trade receivables which is
presented within other expenses.
CADENCE MINERALS PLC
PRINCIPAL ACCOUNTING POLICIES
For the year ended 31 December 2024
45
FINANCIAL ASSETS (CONTINUED)
Subsequent measurement of financial assets
Financial assets at amortised cost
Financial assets are measured at amortised cost if the assets meet the following conditions (and are not
designated as FVTPL):
• they are held within a business model whose objective is to hold the financial assets and collect its
contractual cash flows
• the contractual terms of the financial assets give rise to cash flows that are solely payments of principal
and interest on the principal amount outstanding
After initial recognition, these are measured at amortised cost using the effective interest method. Discounting
is omitted where the effect of discounting is immaterial. The Company’s cash and cash equivalents, trade and
most other receivables fall into this category of financial instruments.
Financial assets at fair value through profit or loss (FVTPL)
Financial assets that are held within a different business model other than ‘hold to collect’ or ‘hold to collect
and sell’ are categorised at fair value through profit and loss. Further, irrespective of business model financial
assets whose contractual cash flows are not solely payments of principal and interest are accounted for at
FVTPL. All derivative financial instruments fall into this category, except for those designated and effective as
hedging instruments, for which the hedge accounting requirements would apply.
Assets in this category are measured at fair value with gains or losses recognised in profit or loss. The fair
values of financial assets in this category are determined by reference to active market transactions or using
a valuation technique where no active market exists.
Impairment of financial assets
The Company considers trade and other receivables individually in accounting for trade and other receivables
as well as contract assets and records the loss allowance as lifetime expected credit losses. These are the
expected shortfalls in contractual cash flows, considering the potential for default at any point during the life
of the financial instrument. In calculating, the Company uses its historical experience, external indicators and
forward-looking information to calculate the expected credit losses using a provision matrix.
FAIR VALUE MEASUREMENT
IFRS 13 establishes a single source of guidance for all fair value measurements. IFRS 13 does not change when
an entity is required to use fair value, but rather provides guidance on how to measure fair value under IFRS
when fair value is required or permitted. The resulting calculations under IFRS 13 affected the principles that
the Company uses to assess the fair value, but the assessment of fair value under IFRS 13 has not materially
changed the fair values recognised or disclosed. IFRS 13 mainly impacts the disclosures of the Company. It
requires specific disclosures about fair value measurements and disclosures of fair values, some of which
replace existing disclosure requirements in other standards.
CADENCE MINERALS PLC
PRINCIPAL ACCOUNTING POLICIES
For the year ended 31 December 2024
46
FINANCIAL INVESTMENTS
Non-derivative financial assets comprising the Company’s strategic financial investments in entities not
qualifying as subsidiaries, associates or jointly controlled entities. These assets are classified as financial assets
at fair value through profit or loss. They are carried at fair value with changes in fair value recognised through
the income statement. Where there is a significant or prolonged decline in the fair value of a financial
investment (which constitutes objective evidence of impairment), the full amount of the impairment is
recognised in the income statement.
Due to the nature of these assets being unlisted investments or held for the longer term, the investment period
is likely to be greater than 12 months and therefore these financial assets are shown as non-current assets in
the Statement of financial position, unless their disposal is likely to occur within the forthcoming year. Listed
investments are valued at closing bid price on 31 December 2024. For measurement purposes, financial
investments are designated at fair value through income statement. Gains and losses on the realisation of
financial investments are recognised in the income statement for the period. The difference between the
market value of financial instruments and book value to the Company is shown as a gain or loss in the income
statement for the period.
CASH AND CASH EQUIVALENTS
Cash and cash equivalents comprise cash at bank and in hand, bank deposits repayable on demand, and other
short term highly liquid investments that are readily convertible into known amounts of cash and which are
subject to an insignificant risk of changes in value, less advances from banks repayable within three months
from the date of advance if the advance forms part of the Company's cash management.
EQUITY
Share capital is determined using the nominal value of shares that have been issued.
The share premium account represents premiums received on the initial issuing of the share capital. Any
transaction costs associated with the issuing of shares are deducted from share premium, net of any related
income tax benefits.
The share based payment reserve represents the cumulative amount which has been expensed in the income
statement in connection with share based payments, less any amounts transferred to retained earnings on
the exercise of share options.
Retained earnings include all current and prior period results as disclosed in the statement of comprehensive
income.
Employee Benefit Trusts (“EBTs”) are accounted for under IFRS 10 and are consolidated on the basis that the
parent has control, thus the assets and liabilities of the EBT are included on the Company balance sheet and
shares held by the EBT in the Company are presented as a deduction from equity.
OPERATING LEASES
The Company does not have any leases within the scope of IFRS 16 in the current or prior year.
Payments, including prepayments, made under low value or short-term operating leases of less than 12
months (net of any incentives received from the lessor) are charged to the statement of comprehensive
income on a straight-line basis over the period of the lease.
CADENCE MINERALS PLC
PRINCIPAL ACCOUNTING POLICIES
For the year ended 31 December 2024
47
FOREIGN CURRENCIES
The financial statements are presented in Sterling, which is also the functional currency of the Company.
In the financial statements of the Company, foreign currency transactions are translated into the functional
currency of the Company entity using the exchange rates prevailing at the dates of the transactions. Foreign
exchange gains and losses resulting from the settlement of such transactions and from the translation of
monetary assets and liabilities denominated in foreign currencies at year-end exchange rates are recognised
in profit or loss.
SHARE BASED PAYMENTS
The Company issues equity-settled share-based payments to certain employees (including directors). Equity-
settled share-based payments are measured at fair value at the date of grant. The fair value determined at the
grant date of the equity-settled share-based payments is expensed on a straight-line basis over the vesting
period, together with a corresponding increase in equity, based upon the Company's estimate of the shares
that will eventually vest.
Fair value is measured using the Black-Scholes model, as the options have no market related conditions. The
expected life used in the model has been adjusted, based on management's best estimate, for the effects of
non-transferability, exercise restrictions and behavioural considerations.
The expense is allocated over the vesting period, based on the best available estimate of the number of share
options expected to vest. Non-market vesting conditions are included in assumptions about the number of
options that are expected to become exercisable. Estimates are subsequently revised, if there is any indication
that the number of share options expected to vest differs from previous estimates.
No adjustment is made to the expense or share issue cost recognised in prior periods if fewer share options
are, ultimately exercised than originally estimated. Upon exercise of share options, the proceeds received net
of any directly attributable transaction costs up to the nominal value of shares issued are allocated to share
capital with any excess being recorded as share premium.
Warrants
The Group has also issued equity settled share-based payments in respect of services provided by debt holders
in the form of warrants. The share-based payment is measured at fair value of the services provided at the
grant date, or if the fair value of the services cannot be reliably measured using the Black-Scholes model. The
expense is allocated over the vesting period.
FINANCIAL LIABILITIES
The Company’s financial liabilities include trade and other payables. Financial liabilities are obligations to pay
cash or other financial assets and are recognised when the Company becomes a party to the contractual
provisions of the instrument.
All financial liabilities are recognised initially at fair value, net of direct issue costs. After initial recognition,
trade and other payables are subsequently measured at amortised cost using the effective interest rate (‘EIR
method’). Gains and losses are recognised in the statement of profit or loss and other comprehensive income
when the liabilities are derecognised, as well as through the EIR amortisation process. Amortised cost is
calculated by considering any discount or premium on acquisition and fees or costs that are an integral part
of the EIR. The EIR amortisation is included as finance costs in the Consolidated Statement of Comprehensive
Income.
CADENCE MINERALS PLC
PRINCIPAL ACCOUNTING POLICIES
For the year ended 31 December 2024
48
FINANCIAL LIABILITIES (CONTINUED)
A financial liability is derecognised when the associated obligation is discharged or cancelled or expires. When
an existing financial liability is replaced by another from the same lender on substantially different terms, or
the terms of an existing liability are substantially modified, such an exchange or modification is treated as the
derecognition of the original liability and the recognition of a new liability. The difference in the respective
carrying amounts is recognised in profit or loss and other comprehensive income.
CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS
Sources of Estimation and Key Judgements
The preparation of the Financial Statements requires the Company to make estimates, judgements and
assumptions that affect the reported amounts of assets, liabilities, revenues and expenses and related
disclosure of contingent assets and liabilities. The Directors base their estimates on historic experience and
various other assumptions that they believe are reasonable under the circumstances, the results of which form
the basis of making judgements about the carrying value of assets and liabilities that are not readily apparent
from other sources. Actual results may differ from these estimates under different assumptions or conditions.
Significant judgments and estimates
The preparation of financial statements requires management to make estimates and judgments that affect
the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of income and expenditure during the reported period.
The estimates and associated judgments are based on historical experience and various other factors that are
believed to be reasonable under the circumstances, the results of which form the basis of making judgments
about carrying values of assets and liabilities that are not readily apparent from other sources.
•
The estimates and underlying judgments are reviewed on an ongoing basis. Revisions to accounting
estimates are recognised in the period in which the estimate is revised if the revision affects only that
period, or in the period of the revision and future periods if the revision affects both current and future
periods.
•
In the preparation of these financial statements, estimates and judgments have been made by
management concerning calculating the fair values of the assets acquired on business combinations,
and the assumptions used in the calculation of the fair value of the share options. Actual amounts could
differ from those estimates.
•
Management has made the following estimates that have the most significant effect on the amounts
recognised in the financial statements.
Unlisted investments
The Company is required to make judgements over the carrying value of investments in unquoted companies
where fair values cannot be readily established and evaluate the size of any impairment required. It is
important to recognise that the carrying value of such investments cannot always be substantiated by
comparison with independent markets and, in many cases, may not be capable of being realised immediately.
Management's significant judgement in this regard is that the value of their investment represents their cost
less previous impairment. The fair value of unquoted investments of the Company at 31 December 2024 was
£13,329 (2023: £11,660). Management have assessed each unlisted investment and concluded that Ferrero
CADENCE MINERALS PLC
PRINCIPAL ACCOUNTING POLICIES
For the year ended 31 December 2024
49
CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS (CONTINUED)
Verde requires an impairment of £93,000. Further information regarding the Group’s unquoted investments
is provided in the investment review of the Strategic Report and in Note 6.
Loan accounting policy
The Company has applied judgement in respect of the accounting treatment of the various contractual
elements with regards to the Mezzanine Loan Facility agreement, entered into during 2023. The loan includes
a clause whereby If the Company elects not to settle a monthly payment in cash they will automatically grant
a right for the payment to be settled in shares as per the non-cash repayment terms contained in the Loan
Facility Agreement (see Note 9 – Borrowings for further details). The Company intends, and has planned to
make all repayments in cash and therefore has considered the value of the embedded derivative to be £nil.
The directors have considered treatment of the loan in its component parts as liability and equity and has
determined the equity component is immaterial.”
•
Management has made the following judgement that has the most significant effect on the amounts
recognised in the financial statements.
Sonora Lithium Project License
As stated in the strategic report, In April 2022 and May 2023, the Mexican Government changed its Mining
Law, which included prohibiting lithium concessions, declaring lithium as a strategic sector, and giving
exclusive rights for lithium mining operations to a state-owned entity. These changes were not meant to affect
existing concessions, such as those held by Mexilit and Megalit. Ganfeng and Cadence believe the reforms
should not impact their project's concessions because they were granted before the Mining Law Reform. This
aligns with the principles of legality and non-retroactivity of laws outlined in the Constitution of Mexico.
While Ganfeng was in discussions with the Secretary of Economy, the General Directorate of Mines ("DGM")
started reviewing nine lithium concessions held by Mexican subsidiaries, including those owned by Mexilit and
Megalit.
The DGM warned that the concessions could be cancelled if the Mexican subsidiaries did not provide enough
evidence within a specified timeframe to prove their compliance with minimum investment obligations for
developing lithium concessions from 2017 to 2021. As of May 2023, Mexilit and Megalit had submitted
extensive evidence of their timely compliance with the minimum investment obligations for the lithium
concessions. However, in August 2023, the DGM issued a formal decision notice to the Mexican subsidiaries,
cancelling nine lithium concessions, including those owned by Mexilit and Megalit.
The cancellations for the lithium concessions issued by the DGM are not final and are subject to ongoing
appeals. Ganfeng and Cadence believe that the Mexican Subsidiaries have complied with their minimum
investment obligations, as Mexican law requires. The mine development investment by the Mexican
Subsidiaries has significantly exceeded the minimum investment obligations, and the Mexican Subsidiaries
regularly submitted annual reports detailing their operations within the prescribed period annually. Ganfeng
and Cadence have filed administrative review recourses before the Secretary of Economy against the
resolutions cancelling the concessions, as they believe these resolutions violate Mexican and international law
and infringe upon their fundamental due process rights.
CADENCE MINERALS PLC
PRINCIPAL ACCOUNTING POLICIES
For the year ended 31 December 2024
50
CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS (CONTINUED)
In November 2023, Cadence issued a Request for Consultations and Negotiations ("Request") to the
Government of Mexico under the United Kingdom-Mexico Bilateral Investment Treaty ("BIT"). The Request
pertains to the alleged revocation of the mining concessions for the Sonora Lithium Project (the "Project") by
the Mexican General Directorate of Mines, as announced by Cadence on 31 August 2023, and related acts and
omissions by Mexico.
The affected concessions include those granted to Mexilit S.A. de CV ("Mexilit") and Minera Megalit S.A. de CV
("Megalit"), which are joint venture companies in which Cadence holds a 30% stake through REMML.
In their Request, Cadence and REMML have identified various BIT obligations that Mexico has breached,
including Mexico's obligation not to unlawfully expropriate the investments of UK investors such as Cadence
and REMML and its obligation to treat such investments fairly and equitably.
In accordance with Article 10 of the BIT, Cadence and REMML have requested consultations and negotiations
with Mexico to resolve the dispute amicably. The BIT provides for disputes to be resolved by international
arbitration if they cannot be resolved through consultation and negotiation.
Recoverability of loan due from REM Mexico
In April 2022 and May 2023, the Mexican Government changed the Mexican Mining Legislation, which
included prohibiting new lithium concessions, declaring lithium as a strategic sector, and giving exclusive rights
for lithium mining operations to a state-owned entity. These changes were not meant to affect existing
concessions, such as those held by Mexilit and Megalit. In May 2023, the General Directorate of Mines ("DGM")
began reviewing and subsequently cancelled nine lithium concessions, including those owned by Mexilit and
Megalit. The cancellations are not final, and Ganfeng has filed an administrative review before the Secretary
of Economy against the resolutions cancelling the concessions (including those owned in part by Cadence), as
they believe these resolutions violate Mexican and international law and infringe upon their fundamental due
process rights. The case is still ongoing, and the recovery of these loans from REM Mexico depends on the
success of the administrative review or any claim filed by Cadence or Ganfeng in the international court of
arbitration.
Adoption of New or Amended IFRS
New standards, amendments and interpretations adopted by the Company
The company has applied the following standards and amendments for the first time for its annual reporting
period commencing 1 January 2024:
•
Amendment to IAS 1 – Presentation of Financial Statements: Non-current liabilities with covenants
•
Amendment to IAS 1 – Presentation of Financial Statements: Classification of Liabilities as Current or
Non-Current
•
Amendments to IAS 7 – Statement of Cash Flows and IFRS 7 – Financial Instruments: Supplier finance
•
Amendment to IFRS 16 – Leases: Leases on sale and leaseback
The adoption of the above has not had any material impact on the disclosures or amounts reported in the
financial statements.
New standards, amendments and interpretations not yet adopted
There are no IFRSs or IFRIC interpretations that are not yet effective that would be expected to have a material
impact on the Company.
CADENCE MINERALS PLC
PRINCIPAL ACCOUNTING POLICIES
For the year ended 31 December 2024
51
CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS (CONTINUED)
Segment reporting
Segmental analysis is not applicable as there is only one operating segment of the continuing business –
investment activities.
CADENCE MINERALS PLC
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 December 2024
52
NOTES TO THE FINANCIAL STATEMENTS
1. PROFIT BEFORE TAXATION AND SEGMENTAL INFORMATION
Profit before taxation - continuing operations
The loss before taxation is attributable to the principal activities of the Company.
The loss before taxation is stated after charging:
Year ended 31
December 2024
Year ended 31
December 2023
£'000
£'000
Share based payment charge
-
25
Directors’ fees and consulting (see Note 2)
461
518
Fees payable to the Company’s auditor for the audit of the financial
statements
59
52
Segment reporting
The Company operates a single primary activity to invest in businesses so as to generate a return for the
shareholders. The performance and position are therefore as stated in the primary statements.
Year ended 31
December 2024
Year ended 31
December 2023
£'000
£'000
Unrealised loss on financial investments
(1,023)
(3,101)
Realised loss on financial investments
(1,102)
(2,793)
(2,125)
(5,894)
CADENCE MINERALS PLC
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 December 2024
53
2.
EMPLOYEE REMUNERATION
Employee benefits expense
The expense recognised for employee benefits, including Directors’ emoluments, is analysed below:
Year ended
Year ended
31 December
2024
31 December
2023
£'000
£'000
Short-term benefits
Wages, salaries and consulting fees
572
628
Employers NI
35
43
607
671
The average number of employees (including directors) employed by the Company during the period was:
2024
2023
No.
No.
Directors
4
4
Other
2
2
6
6
Included within the above are amounts in respect of Directors, who are considered to be the key management
personnel, as follows:
Year ended
Year ended
31 December
2024
31 December
2023
£'000
£'000
Short-term benefits
Wages, salaries and consulting fees
461
518
461
518
Details of Directors' emoluments are included in the Report on Remuneration on pages [29 to 30].
CADENCE MINERALS PLC
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 December 2024
54
3. FINANCE COSTS
Year ended 31
December 2024
Year ended 31
December 2023
£'000
£'000
Loan interest
1
-
Bank interest
1
-
2
-
4. TAXATION
The tax assessed for the period differs from the standard rate of corporation tax in the UK as follows:
Year ended
Year ended
31
December
2024
2024
31
December
2023
2023
£'000
%
£'000
%
(Loss) before taxation
(3,325)
(3,019)
(Loss) multiplied by standard rate
(831)
25.0
(710)
23.52
of corporation tax in the UK
Effect of:
Deferred tax asset not recognised
807
283
Remeasurement of deferred tax for changes in tax rates
-
(17)
Other permanent differences
Chargeable gains
-
-
Income not taxable
-
-
Expenses not deductible for tax purposes
24
444
Total tax charge for year
-
-
The Company has tax losses in the UK of £30.58m (2023: £27.35m), subject to His Majesty's Revenue and
Customs approval, available for offset against future operating profits. The Company has not recognised any
deferred tax asset in respect of these losses, due to there being insufficient certainty regarding its recovery.
The unrecognised deferred tax asset is £7.65m (2023: £6.84m). The main rate of UK corporation tax for the
period up to 1 April 2023 was 19%. From 1 April 2023, the main rate of UK corporation tax increased to 25%,
resulting in an effective tax rate of 23.52% for the year ended 31 December 2023.
CADENCE MINERALS PLC
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 December 2024
55
5. EARNINGS PER SHARE
The calculation of the basic earnings per share is calculated by dividing the consolidated profit attributable to
the equity holders of the Company by the weighted average number of ordinary shares in issue during the
period. The weighted average number of shares excludes shares held by an Employee Benefit Trust (see Note
10) and has been adjusted for the issue of shares during the period.
Year ended
Year ended
31 December 2024
31 December 2023
£’000
£’000
(Loss) attributable to owners of the Company
(3,325)
(3,019)
2024
2023
Number
Number
Weighted average number of shares in issue
207,824,407
177,693,153
Less: shares held by the Employee Benefit Trust (weighted average)
(6,380,000)
(6,380,000)
Weighted average number of shares for calculating basic earnings
per share
201,444,407
171,313,153
Share options and warrants exercisable
n/a
n/a
Weighted average number of shares for calculating diluted earnings
per share
n/a
n/a
2024
2023
Pence
Pence
Basic earnings per share
(1.651)
(1.762)
Diluted earnings per share
n/a
n/a
The impact of the share options is considered anti-dilutive when the Company’s result for a period is a loss.
CADENCE MINERALS PLC
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 December 2024
56
6. FINANCIAL INVESTMENTS
Financial assets at fair value through profit or loss:
£'000
£'000
£'000
£'000
Level 1
Level 2
Level 3
Total
Fair value at 31 December 2022
5,244
-
12,327
17,571
Transfer
1,810
-
(1,810)
-
Additions
5,152
-
2,048
7,200
Fair value changes
(3,101)
-
-
(3,101)
Impairment of assets
-
-
(905)
(905)
Loss on disposals
(2,793)
-
-
(2,793)
Disposal
(2,150)
-
-
(2,150)
Fair value at 31 December 2023
4,162
-
11,660
15,822
Additions
-
-
1,762
1,762
Fair value changes
(1,023)
-
-
(1,023)
Impairment of assets
-
-
(93)
(93)
Loss on disposals
(1,102)
-
-
(1,102)
Disposal
(1,564)
-
-
(1,564)
Fair value at 31 December 2024
473
-
13,329
13,802
Loss on investments held at fair value through profit or loss
Fair value loss on investments
(1,023)
-
-
(1,023)
Realised loss on disposal of investments
(1,102)
-
-
(1,102)
Net loss on investments held at fair value through profit or loss
(2,125)
-
-
(2,125)
Financial assets
£'000
£'000
£'000
£'000
Level 1
Level 2
Level 3
Total
Non-current
-
-
13,329
13,329
current
473
-
-
473
473
-
13,329
13,802
Level 1 represents those assets, which are measured using unadjusted quoted prices for identical assets.
Level 2 applies inputs other than quoted prices that are observable for the assets either directly (as prices) or
indirectly (derived from prices). Level 3 applies inputs, which are not based on observable market data.
Level 1 assets comprise investments in listed securities which are traded on stock markets throughout the
world and are held by the Company as a mix of strategic and short term investments. These are classified as
current assets by virtue of their liquidity. The listed investments have been valued at bid price, as quoted on
their respective Stock Exchanges, at 31 December 2024. During the year ended 31 December 2024 the
company disposed of a variety of its shareholdings.
Level 3 assets comprise of investment in exploration costs where licences are not 100% owned by the
Company, and investments in other companies.
The Directors conducted an impairment review as of 31 December 2024 and determined that an impairment
of £93,000 was necessary for the investment in Ferro Verde.
During 2024, £1,762,000 was invested in exploration costs by the Company (2023: £2,048,000).
CADENCE MINERALS PLC
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 December 2024
57
7. TRADE AND OTHER RECEIVABLES
31 December 2024
31 December 2023
£'000
£'000
Current
Other receivables
75
-
Amounts owed by subsidiaries
3,883
3,883
Prepayments and accrued income
36
54
3,994
3,937
As at 31 December 2024, the balance included in other receivables relates to unpaid share capital from the
December equity issue. This amount was fully settled after the reporting date.
There is no impairment of receivables, and no amounts are past due at 31 December 2024 or 31 December
2023.
The fair value of these financial assets is not individually determined as the carrying amount is a reasonable
approximation of fair value.
8. TRADE AND OTHER PAYABLES
31 December 2024
31 December 2023
£'000
£'000
Trade payables
364
198
Tax and social security
-
14
Other payables
-
1
Accruals and deferred income
119
75
483
288
The fair value of trade and other payables has not been disclosed as, due to their short duration, management
considers the carrying amounts recognised in the balance sheet to be a reasonable approximation of their fair
value.
CADENCE MINERALS PLC
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 December 2024
58
9. BORROWINGS
31 December 2024
31 December 2023
£'000
£'000
Loan Notes
753
1,221
Interest accrued
2
14
755
1,235
During the year ended 31 December 2023, the Company entered into a Mezzanine Loan Facility to finance its
investment in the Amapá Project.
The Mezzanine Loan Facility ("Loan Facility") involves an unconditional and committed initial tranche by the
Investors of US$ 2 million and a further conditional Loan Facility amount of US$ 8 million, subject to agreement
by the Investors. The Loan Facility is valid for three years.
The First Tranche of US$ 2 million, drawn down in 2023, has a 24-month term ("Maturity Date"). It has a six-
month principal repayment holiday, followed by 18 equal monthly cash repayments thereafter to the Maturity
Date. The Loan Facility has an effective annual interest rate of 9.5% and has a 5% implementation on the value
of the First Tranche.
If the Company elects not to settle a monthly payment in cash (each being a "Missed Payment"), they will
automatically grant a right for the Missed Payment to be settled in shares as per the non-cash repayment
terms contained in the Loan Facility Agreement ("Non-Cash Repayment"). Following a Non-Cash Repayment,
the Investors will be automatically granted conversion rights over such principal and interest balances due
concerning the Missed Payment. The Investors will then have the right for 12 months to convert such amounts
either at a price equal to 12.7 pence (representing a 30% premium to the closing price on 25/05/2023) or at a
7% discount to the average of the five daily VWAPs chosen by the Investors in the 20 trading days preceding
its conversion notice or at the price the Company issues further equity if lower than the existing conversion
price.
Cadence has provided a security package to the Investors as part of the Loan Facility. This package includes a
floating charge over the Company's investments, placing its holding in European Metals Holdings into escrow
and the issue of new ordinary shares to the Investors ("Initial Issued Shares"). The Initial Issued Shares
represent 50% of the value of the First Tranche, or 8,251,224 new ordinary shares. These initial Issued Shares
will be used as part of any Non-Cash Repayments if applicable. On the Maturity Date, the Company can utilise
the Initial Issued Shares to pursue its investment strategy or for working capital purposes. If it has settled all
amounts in cash and these Initial Issued Shares revert to the Company.
As part of the Loan Facility, the Company has agreed to grant 8,251,224 warrants to subscribe for ordinary
shares in the Company at an exercise price of 13.2 pence (representing roughly a 35% premium to the current
share price of the Company's Shares) with a 48-month term.
During the year ended 31 December 2024, £841,000 ($1,065,000) in capital and interest was repaid. During
the year ended 31 December 2023, £1,622,000 ($2,000,000) less costs was drawn down. £124,000 ($153,000)
was repaid through the issue of the Initial Issued Shares. The borrowing costs (and resulting fx) have been
capitalised under IAS23, in both years, as the sole purpose of the loan was to finance the Amapá Project.
Repayment terms for the loan were renegotiated during the year, with the final repayment date extended to
November 2025 from May 2025.
CADENCE MINERALS PLC
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 December 2024
59
9. BORROWINGS (CONTINUED)
As the extension of the repayment date consisted of a non-substantial loan-modification, the gross carrying
amount of the loans was recalculated as the present value of the modified contractual cash flows that were
discounted at the loans’ original effective interest rate and a modification gain was recognised in profit or
loss.
Additionally, during the year ended 31 December 2024, a second short term loan agreement for $250,000 was
entered into, of which £79,000 ($100,000) was drawn down by 31 December 2024, and the remaining
$150,000 was drawn down in January & February 2025. The loan carried a 15% interest rate, and was repaid
March 2025, through the transfer of the Ferro Verde asset to the lendor.
10. SHARE CAPITAL
31 December 2024
31 December 2023
£'000
£'000
Allotted, issued and fully paid
173,619,050 deferred shares of 0.24p
417
417
295,971,038 ordinary shares of 1p (31 December 2023:
180,971,037 ordinary shares of 1p)
2,959
1,809
3,376
2,226
Ordinary shares
Ordinary Share Capital
Share
Premium
No.
£'000
£'000
Allotted and issued
At 1 January 2023
172,719,813
1,727
37,612
Issue of shares during the year
8,251,224
82
42
At 31 December 2023
180,971,037
1,809
37,654
Issue of shares during the year
115,000,001
1,150
1,125
Share issue costs
-
-
(188)
At 31 December 2024
295,971,038
2,959
38,591
During the year ended 31 December 2024 the following shares were issued: On 11 April 2024, 16,666,667
shares were issued for proceeds of £500,000. On 19 July 2024, 30,000,000 shares were issued for proceeds of
£750,000. On 24 December 2024, 68,333,334 shares were issued for proceeds of £1,025,000.
As at 31 December 2024, an amount of £75,000 in respect of unpaid share capital remained outstanding. This
amount was fully settled after the reporting date.
Investment in Own Shares
At 31 December 2024 the Company held in Trust 6,380,000 (2023: 6,380,000) of its own shares with a nominal
value of £63,800 (2023: £63,800). The Trust has waived any entitlement to the receipt of dividends in respect
of its holding of the Company’s ordinary shares. The market value of these shares at 31 December was £0.11m
(2023: £0.37m). In the current period nil were repurchased (2023: nil) and nil were transferred into the Trust
(2023: nil), with nil (2023: nil) reissued on award of shares to directors.
The deferred shares have no voting rights and are not eligible for dividends.
CADENCE MINERALS PLC
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 December 2024
60
11. SHARE BASED PAYMENTS
Share Options
The Company operates share option schemes for certain employees (including directors). Options are
exercisable at the option price agreed at the date of grant. The options are settled in equity once exercised.
The expected life of the options varies between 1 and 6 years. All options issued in the prior years vested
immediately, with no vesting requirements.
Details of the number of share options and the weighted average exercise price (WAEP) outstanding during
the period are as follows:
31 December 2024
31 December 2023
Number
WAEP
Number
WAEP
£
£
Outstanding at the beginning of the year
7,200,000
0.290
7,200,000
0.290
Outstanding at the end of the year
7,200,000
0.290
7,200,000
0.290
Exercisable at year end
7,200,000
7,200,000
The share options outstanding at the end of the period have a weighted average remaining contractual life
of 1.33 years (31 December 2023: 2.33 years) and have the following exercise prices and fair values at the
date of grant:
First exercise date
(when vesting
conditions are met)
Grant date
Exercise
price
Fair value
31 December
2024
31 December
2023
£
£
Number
Number
30 April 2021
30 April 2021
0.29
0.02742
7,200,000
7,200,000
7,200,000
7,200,000
At 31 December 2024 7,200,000 options were exercisable (31 December 2023: 7,200,000).
For those options and warrants granted where IFRS 2 “Share-Based Payment” is applicable, the fair values
were calculated using the Black-Scholes model. The inputs into the model for share based payments
recognised in the current and prior year were as follows:
Risk free rate
Share price
volatility
Expected life
Share price at
date of grant
30 April 2021
0.19%
21.6%
5 years
£0.2375
Expected volatility was determined by calculating the historical volatility of the Company’s share price for 12
months prior to the date of grant. The expected life used in the model has been adjusted, based on
management’s best estimate, for the effects of non-transferability, exercise restrictions and behavioural
considerations.
CADENCE MINERALS PLC
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 December 2024
61
11. SHARE BASED PAYMENTS (CONTINUED)
Warrants
Details of the number of warrants and the weighted average exercise price (WAEP) outstanding during the
period are as follows:
31 December 2024
31 December 2023
Number
WAEP
Number
WAEP
£
£
Outstanding at the beginning of the year
10,208,574
0.10665
2,519,850
0.18345
Issued
16,666,667
0.05000
8,251,224
0.13195
Exercised
-
-
Lapsed
(800,000)
(0.20000)
(562,500)
(0.11556)
Outstanding at the end of the year
26,075,241
0.08281
10,208,574
0.10665
Exercisable at year end
26,075,241
10,208,574
The warrants outstanding at the end of the period have a weighted average remaining contractual life of 0.29
years (31 December 2023: 1.32 years) and have the following exercise prices and fair values at the date of
grant:
First exercise date (when
vesting conditions are
met)
Grant date
Exercise price
31 December 2024
31 December
2023
£
Number
Number
28 September 2021
28 September 2021
0.20
-
800,000
25 February 2022
25 February 2022
0.205
1,157,350
1,157,350
1 May 2023
1 May 2023
0.13195
8,251,224
8,251,224
5 April 2024
5 April 2024
0.05
16,666,667
-
26,075,241
10,208,574
For those warrants granted where IFRS 2 “Share-Based Payment” is applicable, the fair values were calculated
using the Black-Scholes model. The inputs into the model for share based payments recognised in the current
and prior year were as follows:
Risk free rate
Share price
volatility
Expected life
Share price at
date of grant
1 May 2023
4.54%
18.2%
2 years
£0.0975
The Company recognised total expenses of £Nil (year ended 31 December 2023: £25,000) relating to equity-
settled share-based payment transactions during the period.
CADENCE MINERALS PLC
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 December 2024
62
12. FINANCIAL INSTRUMENTS
The Company is exposed to a variety of financial risks which result from both its operating and investing
activities. The Board is responsible for co-ordinating the Company's risk management and focuses on actively
securing the Company's short to medium term cash flows. Long term financial investments are managed to
generate lasting returns.
The Company has purchased shares in Companies which are listed on public trading exchanges such as the LSE,
TSX and ASX, and these shares are held as an available-for-sale asset. The most significant risks to which the
Company is exposed are described below:
a Credit risk
The Company's credit risk will be primarily attributable to its trade receivables. At 31 December 2024 and 31
December 2023, the Company had no trade receivables and therefore minimal risk arises.
Generally, the Company’s maximum exposure to credit risk is limited to the carrying amount of the financial
assets recognised at the balance sheet date, as summarised below:
31 December 2024
31 December 2023
Investments
(carried at
fair value)
Loans and
receivables
(carried at
amortised
cost)
Derivative
financial
assets
Statement
of Financial
position
total
Investments
(carried at
fair value)
Loans and
receivables
(carried at
amortised
cost)
Derivative
financial
assets
Statement
of financial
position
total
£’000
£’000
£’000
£’000
£’000
£’000
£’000
£’000
Investments
(carried at fair
value)
473
-
-
473
4,162
-
-
4,162
Other long
term financial
assets
13,329
-
-
13,329
11,660
-
-
11,660
Other
receivables
-
75
-
75
-
-
-
-
Receivables
from investee
companies
3,883
-
3,883
3,883
-
3,883
Prepayments
and accrued
income
-
36
-
36
-
54
-
54
Cash and cash
equivalents
-
655
-
655
-
215
-
215
Total
13,802
4,649
-
18,451
15,822
4,152
-
19,974
Financial 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); and
CADENCE MINERALS PLC
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 December 2024
63
12. FINANCIAL INSTRUMENTS (CONTINUED)
• 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).
In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy.
In such cases, an investment’s level within the fair value hierarchy is based on the lowest level of input that is
significant to the fair value measurement. Management’s assessment of the significance of a particular input
to the fair value measurement in its entirety requires judgement and considers factors specific to the
investment.
Investments
The Company’s investment in shares in Listed Companies are included as a financial investment and has been
classified as Level 1, as market prices are available, and the market is considered an active, liquid market.
The Company’s investment in exploration costs where licences are not 100% owned by the Company, and
investments in other companies are classified as non-current Level 3.
The credit risk on liquid funds is limited because the Company only places deposits with leading financial
institutions in the United Kingdom.
a Liquidity risk
The Company seeks to manage financial risk by ensuring sufficient liquidity is available to meet foreseeable
needs and to invest cash assets safely and profitably. The Directors prepare rolling cash flow forecasts and
seek to raise additional equity funding whenever a shortfall in funding is forecast. Details of the going concern
basis of preparing the financial statements are included in the principal accounting policies.
b Market risk
The amount and quality of minerals available and the related costs of extraction and production represent a
significant risk to the Company. The Company is exposed to fluctuating commodity prices in respect of the
underlying assets. The Company seeks to manage this risk by carrying out appropriate due diligence in respect
of the projects in which it invests.
The Company is exposed to the volatility of the stock markets around the world, on which it holds shares in
various listed entities, and the fluctuation of share prices of these underlying companies. The Company
manages this risk through constant monitoring of its investments share prices and news information but does
not hedge against these investments.
c Interest rate risk
The Company only has borrowings at fixed coupon rates and therefore minimal interest rate risk, as this is
deemed its only material exposure thereto.
d Foreign exchange risk
The Company had borrowings of £755,000 (USD$945,000) at 31 December 2024, which are subject to
exchange rate fluctuations. The Company had borrowings of £1,235,000 (USD$1573,000) at 31 December
2023. The Company operates foreign currency bank accounts to help mitigate the foreign currency risk.
CADENCE MINERALS PLC
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 December 2024
64
12. FINANCIAL INSTRUMENTS (CONTINUED)
Exposure to currency risk Currency risk sensitivity to a +/- 10% change in the exchange rate is shown for the
net currency position per currency. The summary of quantitative data relating to the Group’s exposure to
currency risk as reported to the Group management is as follows.
GBP thousand
USD
AUD
BRL
Exposure
(787)
(78)
1
Sensitivity Analysis (+/-10%)
79
8
-
e Financial liabilities
The Company's financial liabilities are classified as follows:
31 December 2024
31 December 2023
Other
financial
liabilities
at
amortised
cost
Liabilities
not within
the scope
of IAS 39
Total
Other
financial
liabilities at
amortised
cost
Liabilities
not within
the scope
of IAS 39
Total
£'000
£'000
£'000
£'000
£'000
£'000
Trade payables
364
-
364
198
-
198
Accruals and deferred
income
-
119
119
-
75
75
Tax and social security
-
-
-
14
-
14
Other payables
-
-
-
1
-
1
Borrowings
755
-
755
1,235
-
1,235
Total
1,119
119
1,238
1,448
75
1,523
Maturity of financial liabilities
All financial liabilities at 31 December 2024 mature in less than one year. At 31 December 2023 £302,000 of
borrowings mature between one and two years.
Borrowing facilities for the period ended 31 December 2024
The Company had no committed and undrawn borrowing facilities at 31 December 2024 (31 December
2023: £Nil).
The Company had no committed undrawn facilities at 31 December 2024 or 31 December 2023.
CADENCE MINERALS PLC
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 December 2024
65
12. FINANCIAL INSTRUMENTS (CONTINUED)
f Capital risk management
The Company's objectives when managing capital are:
- to safeguard the Company's ability to continue as a going concern, so that it continues to provide returns
and benefits for the shareholders;
- to support the Company's stability and growth; and
- to provide capital for the purpose of strengthening the Company's risk management capability.
The Company actively and regularly reviews and manages its capital structure, to ensure an optimal capital
structure, and equity holder returns, taking into consideration the future capital requirements of the Company
and capital efficiency, prevailing and projected profitability, projected operating cash flows, projected capital
expenditures and projected strategic investment opportunities. Management regards total equity as capital
and reserves, for capital management purposes.
13. RECONCILIATION OF LIABILITIES ARISING FROM FINANCING ACTIVITIES
Short-term
borrowings
Long-term
borrowings
Total
1 January 2024
933
302
1,235
Cash-flows:
- loans received
79
-
79
- Interest charged
265
-
265
- Repayments
(841)
-
(841)
Non-cash:
- Transfer to current
302
(302)
-
- Unrealised Foreign exchange movement
17
-
17
31 December 2024
755
-
755
Short-term
borrowings
Long-term
borrowings
Total
1 January 2023
-
-
-
Cash-flows:
- loans received
1,338
-
1,338
- Interest charged
224
-
224
- Repayments
(162)
-
(162)
Non-cash:
- Transfer to non-current
(302)
302
-
- Loans repaid in shares
(124)
-
(124)
- Unrealised Foreign exchange movement
(41)
-
(41)
31 December 2023
933
302
1,235
CADENCE MINERALS PLC
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 December 2024
66
14. RELATED PARTY TRANSACTIONS
The Company was charged rent totalling £28,221 by Gunsynd Plc, a company of which Don Strang is a director
(2023: £26,572). Of this £11,805 (2023: £11,250) was accrued and £13,833 (2023: £Nil) was unpaid at 31
December 2024.
During the year ended 31 December 2023 Mojito was closed and the Company wrote off an intergroup balance
owed to its wholly owned subsidiary, Mojito Resources Limited, in the amount of £4.18 million. This
transaction represents the forgiveness of the debt by the subsidiary to the parent company. The write-off was
approved by the board of directors of both companies and was deemed necessary due to broader
restructuring or simplification strategy aimed at streamlining the corporate structure. As a result of the write-
off, the parent company's liabilities were reduced by £4.18 million.
Key Management Personnel are considered to be the Company Directors only, and their fees and
remuneration are disclosed in the Directors Remuneration on pages [29 to 30], and within Note [2] to the
financial statements. As at 31 December 2024, Trade and other payables included amounts totalling £136,000
that were outstanding and payable to the Directors. This comprised £36,000 due to Mr A. Fairbourn, £50,000
due to Mr A. Suckling, and £50,000 due to Mr D. Strang.
15. EVENTS AFTER THE END OF THE REPORTING PERIOD
On 17 January 2025, the Company announced the grant of 14,720,000 share options exercisable at 2p per
option. The options vest immediately and expire on 31 December 2030. 3,680,000 options were granted to
each of the four Directors. The new options represent 4.97% of the Company's issued share capital.
16. ULTIMATE CONTROLLING PARTY
In the opinion of the directors, there is no controlling party.