Registered number: 07353748
KERAS RESOURCES PLC
ANNUAL REPORT
FOR THE YEAR ENDED 31 DECEMBER 2024
KERAS RESOURCES PLC
CONTENTS
Pages
Company Information
1
Chairman’s Statement
2
Strategic Report
5
The Board
10
Corporate Governance Statement
11
Directors’ Report
14
Independent Auditor’s Report to the Members of Keras
Resources PLC
17
Consolidated Statement of Comprehensive Income
23
Consolidated Statement of Financial Position
25
Consolidated Statement of Changes in Equity
- 31 December 2024
26
Consolidated Statement of Changes in Equity
- 31 December 2023
27
Consolidated Statement of Cash Flows
28
Company Statement of Financial Position
30
Company Statement of Changes in Equity
31
Notes to the Financial Statements
32
Throughout this document ‘Keras’, ‘Keras Resources’ or ‘the Company’ means Keras Resources
PLC, ‘the Group’ means the Company and its subsidiaries and ‘$’ or ‘USD’ means the United
States dollar.
KERAS RESOURCES PLC
COMPANY INFORMATION
Page 1
Directors:
R Lamming (Executive Chairman)
B Moritz (Non-Executive Director)
C Parry (Non-Executive Director)
Company secretary:
B Moritz
Company number:
07353748
Registered office:
Coveham House,
Downside Bridge Road,
Cobham,
Surrey
KT11 3EP
Nominated advisor
and joint broker:
SP Angel Corporate Finance LLP
35-39 Maddox Street
London W1S 2PP
Joint broker:
Shard Capital Partners LLP
25 Ecclestone Place,
London, SW1W 9NF
Solicitor:
Howard Kennedy
1 London Bridge,
London SE1 9BG
Auditor:
MAH, Chartered Accountants
154 Bishopsgate
London
EC2M 4LN
Registrars:
Share Registrars Limited
3 The Millennium Centre
Crosby Way
Farnham
Surrey
GU9 7XX
KERAS RESOURCES PLC
CHAIRMAN’S STATEMENT
Page 2
I am pleased to provide an update on our progress since the last report and to set out our
outlook for the business going forward.
2024 marked the start of the Company’s transition into a fully focussed North American
business targeting the robust organic fertiliser market. Post consolidating the Company’s 100%
interest in Falcon Isle Resources Corp ("FIR"), the PhoSul Utah LLC joint venture (“JV”) was
concluded in January 2024 between FIR and PhoSul LLC ("PhoSul"), a specialised organic soil
enhancement fertilizer company with granulator operations in Idaho, United States ("US"). In
tandem, FIR acquired an 8.4-acre property in Sutherland, 8 miles north of the town of Delta,
Utah ("Delta Facility") which now houses the Company’s 100% owned processing hub with the
new Integrated Granulator Plant ("Granulator Plant"). The JV agreement comprises a five
year 50:50 JV where PhoSul will provide a zero interest bearing loan for 50% of the construction
and commissioning costs of the Granulator Plant which only be repaid at the end of the initial
5 year JV term, or at the end of the JV if renewed and FIR remains the owner of the Granulator
Plant. All operating expenses for the JV are shared 50:50 and the PhoSul® granulate comprises
80% of FIR's high grade organic rock phosphate from its Diamond Creek mine.
Commissioning of the Granulator Plant commenced in June 2024 and commercial
production was achieved in August 2024. Several upgrades and optimisations were
implemented during the year and the plant producing at nameplate saleable product
output of 5 tons per hour. Although continuous operations were forecast for Q1 2025, the JV
continues to operate on a single shift basis. Increased production through an additional shift
are expected be to implemented during Q4 2025 and will be dependent on sales forecasts
for the 2026 planting season.
The 2024 mining campaign was completed in October 2024 Crushed run-of-mine ("ROM")
ore was hauled to the Delta Facility prior to the onset of winter snowfall for milling to 10 mesh
and 50 mesh for direct sales as well as feed for the Granulator Plant. This was the first winter
that all ROM was stored in a dry, under-roof environment which will significantly benefit the
beneficiation process.
Falcon Isle – Diamond Creek Phosphate Mine
Keras, through its wholly owned subsidiary, Falcon Isle Resources Corp ("FIR"), owns
the Diamond
Creek organic
rock
phosphate
mine
(“Diamond
Creek”)
located
approximately 80km south-east of Salt Lake City and the Integrated Granulator Plant
(“Granulator Plant”) in Delta, both in Utah, USA. Diamond Creek, located on an 840-acre
Federal Lease is one of the highest-grade phosphate deposits in the US and is a fully
integrated mine to market operation with in-house mining and processing facilities.
FIR’s dry, sized rock phosphate products, sold under the PhosAgri organic banner have
received organic certification by all three key certification agencies in the USA – California
(“CDFA”), Washington State (“WSDA”) and the federal Organic Materials Review Institute
(“OMRI”). As a Direct Shipping Ore it requires no chemical or synthetic upgrade processes,
contains low heavy metal impurities, available P2O5 of between 11%-15% which is 3x higher
than any other organic phosphate produced North America, and a calcium content of >25%.
In addition to producing PhosAgri, FIR owns 50% of the PhoSul Utah LLC joint venture (“JV”)
with Phosul LLC which produces the PhoSul® granulate comprising 80% of FIR's high grade
organic rock phosphate from its Diamond Creek mine. Phosul® is the 2024 Green Chemistry
Challenge Award winner for making phosphate fertilizer that avoids hazardous chemicals
and waste emissions associated with traditional phosphate fertilizer production, such as strong
acids, heavy metals, and radioactive materials.
KERAS RESOURCES PLC
CHAIRMAN’S STATEMENT
Page 3
Operations at the Delta Facility are progressing well where we are producing both Phosul®
granulate and Falcon Isle's dry rock phosphate products, sold under the PhosAgri Organic
banner. Sales of PhosAgri Organic for 2024 totalled 5,297 tons, an increase of 15% from the
4,606 tons sold in 2023. Sales of Phosul® from the JV only materially started in January of this
year when the demand for Spring planting began.
The Company is focused on continuing to build market share through its traditional milled dry
rock products as well as its joint venture with Phosul LLC in the fast-growing US organic fertiliser
market and build Falcon Isle Resources into the premier organic phosphate producer in the
US.
Nayéga Cooperation Agreement / Togo
Keras
signed
a
Cooperation
Agreement
in
2023
with
the
Republic
of
Togo
("State")(“Cooperation Agreement”) with regards the Nayéga manganese mine ("Nayéga")
in northern Togo owned by Société Togolaise de Manganèse (STM), the States 100% owned
investment company.
Keras will be paid an advisory fee of 1.5% of gross revenue generated from the Nayéga mine
for the provision of advisory services for 3 years and 6.0% of gross revenue generated from the
Nayéga mine for the provision of brokerage services for the lesser of 3.5 years or 900,000
tonnes of beneficiated manganese ore produced and sold from Nayéga.
On June 6 2025, Carrieres Mines Travaux Publics SA ("CMTP"), Nayéga's mining and logistics
contractor, has completed the dry commissioning of the Nayéga processing plant and has
mobilised its mining fleet to the Nayéga mine site with the aim of starting mining activities by
the end of June 2025 and is expected to be processing ore at an initial rate of 4,000 tonnes
of saleable manganese for the first 3 months starting July 2025 and thereafter at nameplate
capacity of 8,000 tonnes per month of saleable ore.
The progress at Nayéga is very positive for Keras from an additional cashflow perspective and
will underpin cashflows from the Company's flagship operation in Utah, USA. The Company
continues to keep in close contact with the Togo Ministry of Mines in its advisory role with the
State and we look forward to updating shareholders on progress in the near future.
Financial review
The Consolidated Statement of Comprehensive Income for the year shows a loss of £753,000
(2023 - loss £446,000).
In January 2024 and May 2024 the Company issued convertible loans of £300,000 (at a
conversion price of £0.04) and £597,805 (at a conversion price £0.0275) respectively. On the
same dates Falcon Isle issued Promissory Notes of $350,000 (at a 7% per annum interest rate)
and £597,805 (at an 8% per annum interest rate) respectively.
The cash for the January funding was from the Diane H. Grosso Credit Shelter Trust, an associate
of Chris Grosso, a 17% shareholder at the time of the issue and the cash for the May funding
was from the Diane H. Grosso Credit Shelter Trust, Chris Grosso and Joseph Carbonne. Graham
Stacey and I capitalised US$100,000 (GBP78,401) of outstanding fees each due from the
Company on the same basis (50% in the form of Convertible Loans and 50% in the form of
Promissory Notes).
On 25June 2025 the Company issued zero coupon convertible loan notes for £750,000.
KERAS RESOURCES PLC
CHAIRMAN’S STATEMENT
Page 4
The proceeds of the January funding were used to acquire the 8.4-acre Delta Facility, now the
hub of the US operations and the proceeds of the May funding where used to pay the third
tranche of US$800,000 of the cost of acquiring the former minority interest in Falcon Isle plus
$100,000 of the final severance payment payable to the previous CEO of Falcon Isle, and for
general working capital.
The restructuring of the Company’s short-term liabilities reduced the impact of a pure equity
raise and ensures that the Company can meet its current obligations without negatively
impacting the long-term growth profile at the high-grade organic phosphate business in Utah,
USA.
Outlook
Although sales of PhosAgri Organic increased to 5,297 tons in 2024, an increase of 15% from
the 4,606 tons sold in 2023, the Company feels it should have achieved more. PhoSul®
granulate sales were disappointing but were more due to upgrades and optimisations to the
plant at important times in the planting season rather than the demand for the product which
has been robust and continues to grow. We believe that the JV is now positioned to produce
a consistent high grade product into that growing market. The Company believes that its high
grade PhosAgri Organic rock phosphate and the JV’s Phosul® granulates are both
significantly higher quality products compared to their peers and believe that the significant
inroads into their respective markets over the past 18 months will show dividends in the near
term. This sector is underpinned by the macro-economic tailwinds of the global fertiliser
markets, and we remain bullish on our premium phosphate products and our position as we
continue to build market share.
In addition to the cashflow projected from the US business we believe that the Nayéga project
will start to contribute from the beginning of Q4 2025. The Directors are confident that Falcon
Isle will be an increasingly profitable and valuable asset for the Group, and we look forward to
updating our shareholders on our progress as we continue to ramp up production and build
our position and market share of the fast-growing US organic phosphate market.
Finally, I would like to take this opportunity to welcome Colton Hale who joined the Company
as Managing Director of FIR in March 2025 and thank my colleagues on the Board, specifically
Graham Stacey who resigned in January 2025 for their hard work, and shareholders for their
continuing support.
Russell Lamming
Chairman
27 June 2025
KERAS RESOURCES PLC
STRATEGIC REPORT
Page 5
Our stated objective is to become the premier producer of organic rock phosphate fertilizer
products in the United States (“US”). This remains our firm objective having Increased our
ownership of Falcon Isle to 100% on 30 March 2022, putting us in sole control of how we achieve
our objective in the rock phosphate sector of the organic fertilizer market in the US. 2024 was
a challenging year, with the purchase of a freehold factory at Delta, Utah, the removal of the
equipment to that site and the implementation of new granulator plant to produce product
for our 50% owned joint venture associated company, Phosul Utah LLC. Including a testing
period for the new equipment this consumed materially the whole of 2024. Notwithstanding
disruption caused by the plant move, we were able to record an increase in the volume of our
own product.
FIR expects to supply Phosul Utah with a steadily increasing tonnage of Diamond Creek’s high
grade, 50 mesh organic PhosAgri product during the course of 2025 as we expand operations
to an estimated 10,500 tons of PhosAgri annually when the JV is expected to be fully
operational later in 2025. This will be priced at a marginal discount to FIR’s normal selling price.
In due course, sales to Phosul Utah are expected to more than double FIR’s annual turnover at
steady-state operations, and in addition FIR will be entitled to 50% of the profits of the Phosul
Utah.
Our short- to medium-term strategy is therefore to continue milling our crushed ROM ore
through the mobile Prosizer horizontal impact milling and screening unit, and more importantly
to optimise the operation of the integrated plant at our Delta facility. Falcon Isle will retain the
marketing & logistics functions of our own dry milled PhosAgri Organic products (10, 50, and
350 mesh), with marketing of the PhoSul® product being handled by PhoSul LLC with our
assistance on the logistics fronts.
In addition, we will continue to pursue the potential presented by liquid products, through the
solubilising and/or microbial/bacterial digestion of our finer 350 mesh products for use in liquid
blends in fertigation (drip fed irrigation) and hydroponic applications. The application of liquid
organic products at higher available phosphate (P2O5) ensures quicker absorption, provides
for tighter quality control, reduces losses in the application processes and provides us with
access to a rapidly growing indoor controlled environment agricultural (‘CEA’) sector.
Sustainability
Keras is committed to responsible mining and upholding ESG best practice across our business.
We are similarly committed to our stakeholders and are focused on looking to create value
and benefits for all whilst seeking to manage and mitigate the potential impacts that our
operations may have. We are focussed on mining an essential resource that can contribute
to a more sustainable future and importantly sustainable and regenerative agriculture. With
the Diamond Creek mine, we are now moving towards running a more lucrative operation
including production of granulated fertilizer through the PhoSul Utah JV. Our own business
model involving only crushing & milling remains relatively straightforward and we remain
focused on meeting our commitments across the ESG space and will continue to be proactive
in this area as we look to develop and sustain a positive legacy.
Risk Management
The Board regularly reviews the risks to which the Group is exposed and ensures through its
meetings and regular reporting that these risks are minimised as far as possible. The principal
risks and uncertainties facing the Group at this stage in its development are:
KERAS RESOURCES PLC
STRATEGIC REPORT
Page 6
Market Risk
Unlike marketing globally traded, indexed commodities into international markets, growing
market share within the niche organic fertiliser market within North America presents risk in
terms of pricing and volume.
The business has a broad range of existing customers, three of which are anchor clients having
provided commitments to purchase a pleasing base load of our planned annual production.
Our marketing strategy rollout will include presence at industry trade exhibitions and
conferences, as well as regular regional direct contact visits with a comprehensive schedule
of contacts within the wholesale and distribution segments of the organic fertiliser market. Our
business model will largely be driven by uptake from co-operative clients with wide distribution
networks, rather than selling directly to farmers themselves.
Exploration Risk
The Group’s business has included mineral exploration and evaluation which are speculative
activities and there is no certainty that the Group will be successful in the definition of
economic mineral resources, nor that it will proceed to the development of any of its projects
or otherwise realise their value.
The Group aims to mitigate this risk when evaluating new business opportunities by targeting
areas of potential where there is at least some reliable historical sampling, drilling or more
detailed geological data available.
Resource Risk
All mineral projects carry risk associated with defined grade and continuity. Mineral resources
and reserves are calculated by the Group in accordance with accepted industry standards
and codes but are always subject to uncertainties in the underlying assumptions which include
geological projection and commodity price assumptions. The Group reports exploration
targets, mineral resources and ore reserves in accordance with internationally approved
codes where our operations/projects are located, which set minimum standards for public
reporting of mineral exploration results, mineral resources and ore reserves.
Development Risk
Delays in permitting, financing and commissioning a project may result in delays to the Group
meeting development and/or production targets. Changes in commodity prices can affect
the economic viability of mining projects and affect decisions on continuing exploration
activity.
Mining and Processing Technical Risk
Notwithstanding the completion of metallurgical testwork, trial mining and pilot studies
indicating the technical viability of a mining operation, variations in mineralogy, mineral
continuity, ground stability, ground water conditions and other geological conditions may still
render a mining and processing operation economically or technically non-viable. The Group
has a small team of mining professionals experienced in geological evaluation, exploration,
financing and development of mining projects. To mitigate development risk, the Group
supplements this from time to time with engagement of external expert consultants and
contractors.
KERAS RESOURCES PLC
STRATEGIC REPORT
Page 7
Environmental Risk
Exploration and development of a project can be adversely affected by environmental
legislation and the unforeseen results of environmental studies carried out during evaluation of
a project. Once a project is in production unforeseen events can give rise to environmental
liabilities.
As Keras undertakes mining operations, any disturbance to the environment during this phase
is required to be rehabilitated, with specific requirements for closure and closure funding in
accordance with prevailing regulations of the countries in which we operate as well as to
international best-practice. Given the Group’s size and scale it is not considered practical or
cost effective to collect and report data on carbon emissions.
Financing & Liquidity Risk
The Group has had an ongoing requirement to fund its activities through the equity markets
and may in future need obtain finance for further project development. There is no certainty
such funds will be available when needed. To date, Keras has managed to raise funds through
both debt and equity placements despite the very difficult markets that currently exist for
raising funding in the junior mining industry.
Political Risk
All countries carry political risk that can lead to interruption of activity. Politically stable
countries can have enhanced environmental and social permitting 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.
Partner Risk
Whilst there has been no past evidence of this, the Group can be adversely affected if joint
venture or equity partners are unable or unwilling to perform their obligations or fund their share
of future developments. Keras currently operates PhoSul Utah LLC as a 50/50 joint venture with
PhoSul LLC which we regard as mutually beneficial.
Bribery Risk
The Group has adopted an anti-corruption and bribery policy and whistle blowing policy under
the Bribery Act 2010. Notwithstanding this, the Group may be held liable for offences under
that Act committed by its employees or subcontractors, whether or not the Group or the
Directors had knowledge of the commission of such offences.
Financial Instruments
Details of risks associated with the Group’s financial instruments are given in Note 28 to the
financial statements. Keras does not utilise any complex or derivative financial instruments.
COVID-19
Travel and shipping restrictions in place globally during 2021 had a direct impact on timing
and cost of delivery of plant and equipment to the USA. However, given recent developments
the Directors do not believe that Covid 19 will have a material effect on the Company or its
operations going forward.
KERAS RESOURCES PLC
STRATEGIC REPORT
Page 8
Insurance Coverage
The Group maintains a suite of insurance coverage that is appropriate for the Group and
Company. This is arranged via a specialist mining insurance broker and coverage includes
public and products liability, travel, property and medical coverage and assistance while
Group employees and consultants are travelling on Group business. This is reviewed at least
annually and adapted as the Group’s scale and nature of activities changes. Keras also has
Directors and Officers insurance in place.
Internal Controls and Risk Management
The Directors are responsible for the Group’s system of internal financial control. Although no
system of internal financial control can provide absolute assurance against material
misstatement or loss, the Group’s system is designed to provide reasonable assurance that
problems are identified on a timely basis and dealt with appropriately. In carrying out their
responsibilities, the Directors have put in place a framework of controls to ensure as far as
possible that ongoing financial performance is monitored in a timely manner, that corrective
action is taken and that risk is identified as early as practically possible. The Directors review
the effectiveness of internal financial control at least annually.
The Board, subject to delegated authority, reviews capital investment, property sales and
purchases, additional borrowing facilities, guarantees and insurance arrangements.
The Board takes account of the significance of social, environmental and ethical matters
affecting the business of the Group. At this stage in the Group’s development the Board has
not adopted a specific policy on Corporate Social Responsibility as it has a limited pool of
stakeholders other than its shareholders. Rather, the Board seeks to protect the interests of
Keras’ stakeholders through individual policies and through ethical and transparent actions.
The Group has adopted an anti-corruption and bribery policy and a whistle blowing policy as
stated previously.
Shareholders
The Directors are always prepared, where practicable and subject to confidentiality under the
AIM Rules, to enter into dialogue with shareholders to promote a mutual understanding of
objectives. The Annual General Meeting provides the Board with an opportunity to informally
meet and communicate directly with investors.
Employees
The Group has recently employed a country manager based in Utah, USA, but it operates
primarily through contractors. Notwithstanding this, the Group engages its contract employees
to understand all aspects of the Group’s business and seeks to remunerate them fairly, being
flexible where practicable. The Group gives full and fair consideration to applications for
employment received regardless of age, gender, colour, ethnicity, disability, nationality,
religious beliefs, transgender status or sexual orientation. The Group takes account of
employees’ interests when making decisions and welcomes suggestions from employees
aimed at improving the Group’s performance.
The Group currently operates exclusively in the USA but with agreements with the Togolese
State to provide advisory and brokerage services in Togo. It recruits locally as many of its
employees and contractors as practicable. The Company has three directors, two male and
one female.
KERAS RESOURCES PLC
STRATEGIC REPORT
Page 9
Suppliers and Contractors
The Group recognises that the goodwill of its contractors, consultants and suppliers is important
to its business success and seeks to build and maintain this goodwill through fair dealings. The
Group has a prompt payment policy and seeks to settle all agreed liabilities within the terms
agreed with suppliers. Contractors are appointed based on a detailed assessment of their
capabilities, capacity and track record. Over time, as the Company grows its understanding
of the various aspects of its operations in-sourcing of certain operational components may be
considered as a means to reduce costs.
Health and Safety
The Board recognises that it has a responsibility to provide strategic leadership and direction
in the development of the Group’s health and safety strategy in order to protect all of its
stakeholders. The Group does not have a formal health and safety policy at this time. This is re-
evaluated as and when the Group’s nature and scale of activities expand.
Section 172 statement
The Directors believe they have acted in the way most likely to promote the success of the
Company for the benefit of its members as a whole, as required by s172 of the Companies Act
2006.
The requirements of S172 are for the Directors to:
•
Consider the likely consequences of any decision in the long-term;
•
Act fairly between the members of the Company;
•
Maintain a reputation for high standards of business conduct;
•
Consider the interests of the Company’s employees;
•
Foster the Company’s relationships with suppliers, customers and others; and
•
Consider the impact of the Company’s operations on the community and the
environment.
The Company’s operations and strategic aims are set out throughout the Strategic Report and
in the Chairman’s Statement, and relationships with stakeholders are also dealt with in the
Corporate Governance Statement.
Russell Lamming
Director
This Strategic Report was approved by the Board of Directors on 27 June 2025.
KERAS RESOURCES PLC
THE BOARD
Page 10
RUSSELL LAMMING
Executive Chairman
Russell Lamming is a qualified geologist with an honours degree in geology from the University
of the Witwatersrand and a Bachelor of Commerce in Economics from the University of Natal.
Russell has a broad range of experience including directorship of a South African mining
consultancy and precious metals analyst for a leading international broker and was the CEO
of AIM listed Chromex Mining and Goldplat Plc. He has strong relationships in London and
internationally and has raised considerable funds for resource companies over the years.
BRIAN MORITZ
Non-Executive Director
Brian is a Chartered Accountant and former Senior Partner of Grant Thornton, London. He
formed Grant Thornton’s Capital Markets Team which floated over 100 companies on AIM
under his chairmanship. In 2004 he retired from Grant Thornton to concentrate on bringing new
companies to the market as a director. He concentrates on mining companies, primarily in
Africa, and was formerly chairman of African Platinum PLC (“Afplats”) and Metal Bulletin PLC
as well as currently being a director of several junior mining companies.
CLAIRE PARRY
Non-Executive Director
Claire is a Chartered Accountant and the senior partner in the Canterbury office of Azets, a
top 10 UK accounting firm. With over 20 years in the accountancy profession, she specialises
in audit services, and also has practical experience in the application of IFRS and accounting
and financial control generally for smaller quoted companies, primarily in the natural resources
sector.
KERAS RESOURCES PLC
CORPORATE GOVERNANCE STATEMENT
Page 11
To the extent applicable, and to the extent able (given the current size and structure of the
Company and the Board), the Company has adopted the Quoted Companies Alliance
Corporate Governance Code. Details of how the Company complies with the principles
contained in the Code are set out below. The Company intends to comply with the newly
revised Code in due course.
No key governance matters have arisen since the publication of the last Annual Report.
Taking account of the Company’s size and nature, the Board considers that the current Board
is a cost effective and practical method of directing and managing the Company. As the
Company’s activities develop in size, nature and scope, the size of the Board and the
implementation of additional corporate governance policies and structures will be reviewed.
Further disclosures under the Code are included on the Company’s website.
Principle 1: Establish a strategy and business model which promote long term value for
shareholders.
The Company’s strategy is to identify mining projects which can be developed to create value
and income for shareholders. In June 2017 this strategy was successfully demonstrated when
the Company’s Australian gold exploration assets were floated on the Australian Securities
Exchange (ASX) with the name Calidus Resources Limited. In November 2019 the Company’s
shares in Calidus were demerged and transferred to the Company’s shareholders by way of a
capital reduction.
The demerger permitted the Board to examine other projects, and in particular the Diamond
Creek phosphate mine in Utah, USA, where the Company completed the staged acquisition
of 100% equity interest in March 2022. This is now the Group’s main project. A joint venture with
PhoSul LLC, a specialised organic soil enhancement fertilizer company with granulator
operations in Idaho, United States, is expected to hasten expansion in the USA.
The Company had, for some years, been seeking to convert the Research Permits held by its
85% owned subsidiary, Société Générale de Mines SA, over the Nayéga manganese project
in Togo, to an Exploitation Permit. The Company has sold its intellectual property and other
assets relating to Nayéga to a newly formed parastatal company, so that it no longer operates
in Togo, but will continue to provide advisory and brokerage services relating to the Nayéga
Mine to the Togolese State.
Principle 4: Embed effective risk management, considering both opportunities and threats,
throughout the organisation.
The risks facing the Company are detailed in the Strategic Report. The Board seeks to mitigate
such risks so far as it is able to do, but certain important risks cannot be controlled by the Board.
In particular, products the Company is seeking to identify and mine are traded globally at
prices reflecting supply and demand rather than the cost of production. So far as the
Company is concerned, the substantial decline in the price of iron ore rendered two previous
projects non-viable, both of which had previously appeared to have substantial value on a
discounted cash flow basis, and they were abandoned.
The Company will only invest in exploration projects where there is a legal right to convert an
initial exploration licence to a mining licence.
KERAS RESOURCES PLC
CORPORATE GOVERNANCE STATEMENT
Page 12
Principle 5: Maintain the Board as well-functioning, balanced team led by the chair.
Graham Stacey, the previous CEO, had with primary responsibility for the Diamond Creek
phosphate mine in Utah, USA. His function in Utah has now devolved to a newly recruited full
time country manager, Colton Hale. Russell Lamming has become executive Chairman on a
temporary basis, The other directors, Brian Moritz and Claire Parry are non-executive directors,
of whom Claire Parry is independent. Board meetings are normally conducted by video
conference or by telephone, supplemented by physical meetings.
The Executive Chairman is in regular touch with the Directors, by email and telephone.
Non-executive directors are committed to devote 24 days per annum to the Company, but
they are likely to exceed that required time commitment. Standard director’s fees are currently
£24,000 per annum for each non-executive director, below the median for AIM companies.
Brian Moritz also acts as Company Secretary and has board responsibility for accounting
matters and receives an extra £12,000 per annum in respect of those responsibilities. No further
amounts are paid for serving on Board committees.
There were 11 board meetings held in 2024. With the exception of meetings solely to formally
ratify agreed decisions, all directors were present at those meetings.
Principle 6: Ensure that between them the directors have the necessary up-to-date experience,
skills and capabilities.
Brief CVs of the directors are disclosed elsewhere in this Annual Report.
Each of the directors maintains up to date skills by a combination of technical journals, courses,
conferences and trade shows.
As an exploration and mining Company the Board requires skills in the area of geology and
mining. Russell Lamming is a qualified geologist with long experience in the management of
junior mining companies. Importantly, he has previously been in charge of the construction
and operation of mines.
Brian Moritz and Claire Parry are Chartered Accountants. In addition to his financial skills, Brian
Moritz has previously been registered as a Nominated Adviser and has wide experience of
corporate transactions.
The advice of Azets, a top 10 UK accounting firm in which Claire Parry is a partner, has been
sought on technical accounting matters, in particular in relation to compliance with IFRS.
Principle 7: Evaluate Board performance based on clear and relevant objectives, seeking
continuous improvement.
The Board has successfully achieved a major objective by acquiring a phosphate mine in Utah,
USA, acquiring freehold premises in which to construct a processing plant and commencing
production. The next stage for this mine is to expand its product range and client base., which
it expects to achieve through the joint venture. Phosul Utah LLC.
The Board will concentrate on achieving profitable production and positive cash flow from its
existing project while continuing to seek other projects.
Given the current state of the Company’s development the directors believe that the Board
operates efficiently and cost effectively and that the cost of an external review process is not
justified.
Principle 8: Promote a corporate culture that is based on ethical values and behaviours.
So far as possible the Company recruits locally for staff and sub-contractors.
KERAS RESOURCES PLC
CORPORATE GOVERNANCE STATEMENT
Page 13
In Utah, the Group’s product is a natural organic fertilizer which plays its part in reducing
reliance on synthetically manufactured fertilizers, which have a high carbon footprint.
The Company has adopted a comprehensive anti-corruption and whistle blowing policy and
an ethical policy which is strictly applied.
Principle 10: Communicate how the Company is governed and is performing by maintaining
a dialogue with shareholders and other relevant stakeholders.
The Board communicates with its stakeholders through social media and webcasts, as well as
by announcements on RNS. It welcomes the ability to meet and engage with shareholders at
general meetings.
The audit committee normally meets twice per annum, on its own to consider and approve
the interim results, and with the auditors to consider the annual report and matters raised by
the auditors based on their audit. So far as possible recommendations by the auditors are
immediately implemented. As the CEO is also present as an observer at such meetings, no
further report is submitted to the Board.
The remuneration committee meets on an ad hoc basis when required. No meeting was
required or held in 2024, and no formal report was issued. Fees paid to the non-executive
directors are settled by the Chief Executive Officer, now by the Executive Chairman.
Russell Lamming
Chairman
KERAS RESOURCES PLC
DIRECTORS’ REPORT
Page 14
The Directors present their report together with the audited financial statements of the Group
for the year ended 31 December 2024.
The Group’s projects are set out in the Strategic Report.
Review of business and financial performance
Further details on the financial position and development of the Group are set out in the
Chairman’s Statement, the Strategic Report and the annexed financial statements.
Strategic Report
In accordance with Companies Act, s414C(11), the Company has chosen to set out in the
Company’s strategic report information required by Large and Medium-sized Companies and
Groups (Accounts and Reports) Regulations 2008, s7, to be contained in the directors’ report.
It has done so in respect of the review and analysis of the business during the current year.
Results
The Group reports a loss for the year of £753,000 (2023 - loss £446,000).
Major events after the balance sheet date
Subsequent events are detailed in note 30.
Dividends
The Directors do not recommend payment of a dividend for the year ended 31 December
2024 (2023 - £nil).
Political donations
There were no political donations during the year (2023 - £nil).
Energy and carbon report
The Group is classified as “a low energy user” under these regulations therefore is exempt from
reporting on its emissions, energy consumption or energy efficiency activities.
Going concern
The Directors continue to adopt the going concern basis in preparing the financial statements
as further explained in Note 2 to the financial statements.
Directors’ indemnities
The Group maintains Directors and Officers liability insurance providing appropriate cover for
any legal action brought against its Directors and/or officers.
Audit Committee
The Audit Committee, which currently comprises B Moritz and C Parry, and is chaired by B
Moritz, is responsible for ensuring the financial performance, position and prospects of the
Group are properly monitored and reported on and for meeting the auditors and reviewing
their reports relating to accounts and internal controls. Meetings of the Audit Committee are
held at least twice a year, at appropriate times in the reporting and audit cycle. The Audit
Committee reports to the Board on its proceedings after each meeting on all matters for which
it has responsibility. The members of the Audit Committee are subject to annual re-election by
the Board.
KERAS RESOURCES PLC
DIRECTORS’ REPORT
Page 15
Remuneration Committee
The Remuneration Committee, which comprises B Moritz and C Parry and which is chaired by
B Moritz, reviews the performance of the executive directors and sets their remuneration,
determines the payment of bonuses to executive directors and considers the future allocation
of share options and other equity incentives pursuant to any share option scheme or equity
incentive scheme in operation from time to time to Directors and employees. Meetings of the
Remuneration Committee are held on an ad hoc basis as required. The Remuneration
Committee reports to the Board on its proceedings on all matters for which it has responsibility.
The members of the Remuneration Committee are subject to annual re-election by the Board.
Directors
The following Directors held office throughout the year:
B Moritz
R Lamming
G Stacey
(resigned 16 January 2025)
C Parry
Directors’ interests
The beneficial interests of the Directors holding office on 31 December 2024 in the issued share
capital of the Company, including spouses of Directors, were as follows:
2024
2023
Number of
Ordinary
Shares
Percentage
of issued
ordinary
share
capital
Number of
Ordinary
Shares
Percentage
of issued
ordinary
share
capital
R Lamming
4,611,845
4.83%
4,611,845
5.76%
G Stacey
437,390
0.46%
437,390
0.55%
B Moritz
C Parry
2,125,821
-
2.23%
-
2,125,821
-
2.65%
-
On 7 April 2025 Russell Lamming subscribed for 1,816,836 new ordinary shares and Brian Moritz
subscribed for 523,383 new ordinary shares. Both subscriptions were at a price of 1.4861p per
share.
Directors’ remuneration and service contracts
Details of remuneration payable to Directors as disclosed in note 11 to these financial
statements:
Remuneration
£’000
Share-based
payments
£’000
2024
Total
£’000
2023
Total
£’000
B Moritz
C Parry
36
24
-
-
36
24
36
24
R Lamming
48
-
48
127
G Stacey
147
6
153
142
255
6
261
329
KERAS RESOURCES PLC
DIRECTORS’ REPORT
Page 16
Statement of Directors’ responsibilities
The Directors are responsible for preparing the strategic report, the directors’ 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 Group financial statements in
accordance with UK-adopted International Accounting Standards ("UK-adopted IAS") in
conformity with the requirements of the Companies Act 2006 and the company financial
statements in accordance with United Kingdom Generally Accepted Accounting Practice
(United Kingdom Accounting Standards, comprising FRS 101 “Reduced Disclosure Framework”,
and applicable law).
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 of the Group and Parent Company
and of the profit or loss of the Group and Parent 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 the consolidated financial statements comply with UK-adopted IAS and the
parent company financial statements are prepared in accordance with UK GAAP/FRS 101
in conformity with the requirements of the Companies Act 2006, subject to any material
departures disclosed and explained in the financial statements; and
•
prepare the financial statements on the going concern basis unless it is inappropriate to
presume that the Group and Company will continue in business.
The Directors are responsible for keeping adequate accounting records that are sufficient to show
and explain the Group’s and Company’s transactions and disclose with reasonable accuracy at
any time the financial position of the Company and the Group 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 the Group and hence for taking reasonable steps
for the prevention and detection of fraud and other irregularities.
The Company is compliant with AIM Rule 26 regarding the Company’s website.
Statement of disclosure to auditor
Each Director at the date of approval of this report confirms that;
So far as they are aware,
•
there is no relevant audit information of which the Company’s auditor is unaware; and
•
they have taken all steps that they ought to have taken to make themselves aware of any
relevant audit information and to establish that the auditor is aware of that information.
Auditor
A resolution proposing the re-appointment of MAH, Chartered Accountants, as auditor of the
Company will be proposed at the Annual General Meeting.
By order of the Board
Brian Moritz
Director
27 June 2025
KERAS RESOURCES PLC
INDEPENDENT AUDITOR’S REPORT
TO THE MEMBERS OF KERAS RESOURCES PLC
Page 17
Opinion
We have audited the financial statements of Keras Resources Plc (the ‘parent company’) and
its subsidiaries (the ‘group’) for the year ended 31 December 2024 which comprise the
Consolidated Statement of Comprehensive Income, the Consolidated and Parent Company
Statement of Financial Position, the Consolidated and Parent Company Statements of
Changes in Equity, the Consolidated Statement of Cash Flows and Notes to the Consolidated
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. The financial reporting framework that has been applied
in the preparation of the parent company financial statements is United Kingdom Accounting
Standards, including FRS 101 Reduced Disclosure Framework (United Kingdom Generally
Accepted Accounting Practice) and as applied in accordance with the provisions of the
Companies Act 2006.
In our opinion:
•
the financial statements give a true and fair view of the state of the group’s and of the
parent company’s affairs as at 31 December 2024 and of the group’s loss for the year
then ended;
•
the group financial statements have been properly prepared in accordance with UK-
adopted international accounting standards;
•
the parent company financial statements have been properly prepared in accordance
with United Kingdom Generally Accepted Accounting Practice and as applied in
accordance with the provisions of the Companies Act 2006; and
•
the financial statements have been prepared in accordance with the requirements of
the Companies Act 2006.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs
(UK)) and applicable law. Our responsibilities under those standards are further described in
the Auditor’s responsibilities for the audit of the financial statements section of our report. We
are independent of the group and parent company in accordance with the ethical
requirements that are relevant to our audit of the financial statements in the UK, including the
FRC’s Ethical Standard as applied to listed entities, and we have fulfilled our other ethical
responsibilities in accordance with these requirements. We believe that the audit evidence we
have obtained is sufficient and appropriate to provide a basis for our opinion.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the directors’ use of the going
concern basis of accounting in the preparation of the financial statements is appropriate. Our
evaluation of the directors’ assessment of the group’s and parent company’s ability to
continue to adopt the going concern basis of accounting included reviewing cashflow
forecasts covering a period of 12 months from the date of approval of these financial
statements, considering the levels of discretionary and non-discretionary expenditure
forecasted, challenging and conducting sensitivity analysis using the key inputs and
assumptions underpinning said forecasts, ascertaining the group and parent company’s
current cash position and reviewing the group and parent company’s performance since the
period end.
KERAS RESOURCES PLC
INDEPENDENT AUDITOR’S REPORT
TO THE MEMBERS OF KERAS RESOURCES PLC
Page 18
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 group's or parent 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.
Our application of materiality
For the purposes of determining whether the financial statements are free from material
misstatement, we define materiality as the magnitude of misstatement that makes it probable
that the economic decisions of a reasonably knowledgeable person, relying on the financial
statements, would be changed, or influenced. We also determine a level of performance
materiality which we use to assess the extent of testing needed to reduce to an appropriately
low level the probability that the aggregate of uncorrected and undetected misstatements
exceeds materiality for the financial statements as a whole.
Materiality for the group financial statements as a whole was set as £123,000. This was
calculated based upon 2% of gross assets due to the group’s significant capitalised exploration
costs being key balances of interest within the financial statements and the fact that though
generating revenues, the group is not yet profit generating.
Materiality for the parent company financial statements as a whole was set as £118,000.
We also agreed to report to the audit committee any other audit misstatements below the
triviality thresholds established above which we believe warranted reporting on qualitative
grounds.
Our approach to the audit
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.
In designing our audit, we considered areas involving significant accounting estimates and
judgements by the directors as well as future events that are inherently uncertain. These
included the recoverable value of the group’s capitalise exploration expenditure, the
recoverable value of the parent company’s investment in its subsidiary and the amounts due
to the parent company by its subsidiaries. We also addressed the risk of management override
of internal controls, including among other matters consideration of whether there was
evidence of bias that represented a risk of material misstatement due to fraud.
We performed full scope audits of the financial information of the components within the
Group which were individually financially significant and material. We also performed specified
audit procedures over certain account balances and transaction classes that we regarded as
material to the Group, as well as analytical procedures, for components which were not
significant and not material. The audit work and specified audit procedures covered the whole
of the Group.
KERAS RESOURCES PLC
INDEPENDENT AUDITOR’S REPORT
TO THE MEMBERS OF KERAS RESOURCES PLC
Page 19
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.
Key Audit Matter
How our scope addressed this matter
Going Concern
The group made a loss for the year and it
had low cash reserves and net current
liabilities at the year end.
There is a risk that the group may have
uncertainty over going concern.
We obtained and reviewed Management’s
latest group and parent company cashflow
forecasts covering the going concern period;
challenging the key assumptions, reviewing the
mathematical accuracy of the forecast and
conducting sensitivity analysis.
We ascertained the latest group cash position
and performance post period end and we also
reviewed the post year end loan agreements.
Based on our procedures we concluded that
the going concern basis of preparation is
appropriate and that there is no materiality
uncertainty relating to going concern.
Carrying value of intangible assets
As at 31 December 2024 the Group has
intangible assets with a carrying value of
£3,574,000 which represents capitalised
exploration and evaluation costs.
Given the value of the balance and the
significant
estimates
and
judgements
required to be made by management when
conducting their impairment assessments,
there is a risk that the exploration costs
capitalised may be materially misstated as
they are impaired and/or costs capitalised
in the year have been inappropriately
capitalised in accordance with the eligibility
requirements of IFRS 6.
Our work in this area included but was not
limited to:
• Confirming that the group held good title to
the underlying licenses and assessing whether
any indicators of impairment exists.
•
Obtaining
Management’s
impairment
assessments in relation to intangible assets and
supporting discounted cashflow forecasts.
Reviewing
their
assessment
and
their
supporting
value
in
use
calculates
for
reasonableness; considering whether any of
the IAS 36 impairment indicators have been
met and considering if the recoverable value
exceeds the carrying value.
We consider Management’s assessment of
impairment is reasonable in concluding that no
impairment is required to be recognised at the
year end.
KERAS RESOURCES PLC
INDEPENDENT AUDITOR’S REPORT
TO THE MEMBERS OF KERAS RESOURCES PLC
Page 20
Other information
The other information comprises the information included in the annual report, other than the
financial statements and our auditor’s report thereon. The directors are responsible for the other
information contained within the annual report. Our opinion on the group and parent company
financial statements does not cover the other information and, except to the extent otherwise
explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our
responsibility is to read the other information and, in doing so, consider whether the other
information is materially inconsistent with the financial statements or our knowledge obtained in
the course of the audit, or otherwise appears to be materially misstated. If we identify such
material inconsistencies or apparent material misstatements, we are required to determine
whether this gives rise to a material misstatement in the financial statements themselves. If, based
on the work we have performed, we conclude that there is a material misstatement of this other
information, we are required to report that fact.
We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of the audit:
•
the information given in the strategic report and the directors’ report for the financial
period for which the financial statements are prepared is consistent with the financial
statements; and
•
the strategic report and the directors’ report have been prepared in accordance with
applicable legal requirements.
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the group and the parent company and
their environment obtained in the course of the audit, we have not identified material
misstatements in the strategic report or the directors’ report.
We have nothing to report in respect of the following matters in relation to which the Companies
Act 2006 requires us to report to you if, in our opinion:
•
adequate accounting records have not been kept by the parent company, or returns
adequate for our audit have not been received from branches not visited by us; or
•
the parent company financial statements are not in agreement with the accounting
records and returns; or
•
certain disclosures of directors’ remuneration specified by law are not made; or
•
we have not received all the information and explanations we require for our audit.
KERAS RESOURCES PLC
INDEPENDENT AUDITOR’S REPORT
TO THE MEMBERS OF KERAS RESOURCES PLC
Page 21
Responsibilities of directors
As explained more fully in the Statement of Directors’ Responsibilities, the directors are responsible
for the preparation of the group and parent company financial statements and for being satisfied
that they give a true and fair view, and for such internal control as the directors determine is
necessary to enable the preparation of financial statements that are free from material
misstatement, whether due to fraud or error.
In preparing the group and parent company financial statements, the directors are responsible
for assessing the group and the parent company’s ability to continue as a going concern,
disclosing, as applicable, matters related to going concern and using the going concern basis of
accounting unless the directors either intend to liquidate the group or the parent company or to
cease operations, or have no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a
whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s
report that includes our opinion. Reasonable assurance is a high level of assurance but is not a
guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material
misstatement when it exists. Misstatements can arise from fraud or error and are considered
material if, individually or in the aggregate, they could reasonably be expected to influence the
economic decisions of users taken on the basis of these financial statements.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We
design procedures in line with our responsibilities, outlined above, to detect material
misstatements in respect of irregularities, including fraud. The extent to which our procedures are
capable of detecting irregularities, including fraud is detailed below:
• We obtained an understanding of the group and parent company and the sector in which
they operate to identify laws and regulations that could reasonably be expected to have
a direct effect on the financial statements. We obtained our understanding in this regard
through discussions with management, industry research and our cumulative audit
knowledge and experience of the sector.
• We determined the principal laws and regulations relevant to the group and parent
company in this regard to be those arising from UK Company Law, rules applicable to
issuers on AIM, UK and US employment law and local mining, environmental and health
and safety laws in the US.
•
We designed our audit procedures to ensure the audit team considered whether there
were any indications of non-compliance by the group and parent company with those
laws and regulations. These procedures included, but were not limited to:
o
Discussions with management regarding compliance with laws and regulations by
the parent company and the components;
o
Review of board minutes; and
o
Review of regulatory news announcements made throughout and post period-
end.
KERAS RESOURCES PLC
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 23
Notes
Continuing
operations
2024
£’000
Discontinued
operations
2024
£’000
Total
2024
£’000
Continuing
operations
2023
£’000
Discontinued
operations
2023
£’000
Total
2023
£’000
Revenue
7
1,119
-
1,119
916
-
916
Cost of sales
(825)
-
(825)
(386)
-
(386)
Gross profit
294
-
294
530
-
530
Profit on sale of intellectual property
relating to Togo
21
-
-
-
-
121
121
Loss on disposal of a subsidiary
21
-
-
-
-
(76)
(76)
Administrative expenses
Share of losses of associated company
(832)
(132)
-
-
(832)
(132)
(826)
-
(16)
-
(842)
-
(Loss)/profit from operating
activities
(670)
-
(670)
(296)
29
(267)
Finance costs
Rent income
12
(208)
125
-
-
(208)
125
(173)
-
-
-
(173)
-
Net finance costs
(83)
-
(83)
(173)
-
(173)
(Loss)/profit before taxation
(753)
-
(753)
(469)
29
(440)
Tax
13
-
-
-
(6)
-
(6)
(Loss)/profit for the year
(753)
-
(753)
(475)
29
(446)
Other comprehensive income – items
that may be subsequently reclassified
to profit or loss
Exchange translation on foreign operations
16
-
16
(245)
-
(245)
Total comprehensive (loss)/profit for the
year
(737)
-
(737)
(720)
29
(691)
KERAS RESOURCES PLC
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 24
(Loss)/profit attributable to:
Owners of the Company
(753)
-
(753)
(475)
-
(475)
Non-controlling interests
-
-
-
-
29
29
(Loss)/profit for the year
(753)
-
(753)
(475)
29
(446)
Total comprehensive loss attributable to:
Owners of the Company
(737)
-
(737)
(720)
-
(720)
Non-controlling interests
-
-
-
-
29
29
Total comprehensive loss for the year
(737)
-
(737)
(720)
29
(691)
Earnings per share
Basic and diluted loss per share (pence)
24
(0.888)
(0.863)
The notes on pages 32 to 63 are an integral part of these consolidated financial statements.
KERAS RESOURCES PLC
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2024
Page 25
Notes
2024
£’000
2023
£’000
Assets
Property, plant and equipment
14
1,422
346
Right of use asset
15
-
-
Intangible assets
16
3,574
3,404
Investment in associated
company
17
57
-
Non-current assets
5,053
3,750
Inventory
19
532
621
Trade and other receivables
20
319
171
Cash and cash equivalents
249
185
Current assets
1,100
977
Total assets
6,153
4,727
Equity
Share capital
23
954
801
Share premium
23
6,073
5,849
Share option reserve
Exchange reserve
23, 25
116
(90)
104
(106)
Convertible loan note reserve
23
116
-
Retained (deficit)/earnings
(4,218)
(3,465)
Total equity
2,951
3,183
Liabilities
Trade and other payables
26
1,205
1,013
Current liabilities
1,205
1,013
Loans and other borrowings
27
1,997
-
Other long term liabilities
26
-
531
Non-current liabilities
1,997
531
Total liabilities
3,202
1,544
Total equity and liabilities
6,153
4,727
The financial statements were approved by the Board of Directors and authorised for issue on 27 June
2025. They were signed on its behalf by:
Russell Lamming
Director
The notes on pages 32 to 63 are an integral part of these consolidated financial statements.
KERAS RESOURCES PLC
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 26
Attributable to owners of the Company
Notes
Share
capital
£‘000
Share
premium
£‘000
Share
option
/warrant
reserve
£‘000
Exchange
reserve
£‘000
Convertible
loan notes
reserve
£’000
Retained
earnings
/(deficit)
£‘000
Total
£‘000
Balance at 1 January
2024
801
5,849
104
(106)
-
(3,465)
3,183
Loss for the year
-
-
-
-
-
(753)
(753)
Other comprehensive
income
-
-
-
16
-
-
16
Total comprehensive
(loss)/profit for the year
-
-
-
16
-
(753)
(737)
Issue of ordinary shares
23
153
224
-
-
-
-
377
Issue of convertible loan
notes
-
-
-
-
116
-
116
Share option expense
25
-
-
12
-
-
-
12
Transactions with owners,
recognised directly in equity
153
224
12
-
116
-
505
Balance at 31 December 2024
954
6,073
116
(90)
116
(4,218)
2,951
The notes on pages 32 to 63 are an integral part of these consolidated financial statements.
KERAS RESOURCES PLC
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
Page 27
Attributable to owners of the Company
Notes
Share
capital
£‘000
Share
premium
£‘000
Share
option
/warrant
reserve
£‘000
Exchange
reserve
£‘000
Retained
earnings/
(deficit)
£‘000
Total
£‘000
Non-
controlling
interests
£‘000
Total
equity
£‘000
Balance at 1 January 2023
797
5,838
102
180
(2,990)
3,927
(146)
3,781
(Loss)/profit for the year
-
-
-
-
(475)
(475)
29
(446)
Other comprehensive income/(loss)
-
-
-
(245)
-
(245)
-
(245)
Total comprehensive income/(loss) for
the year
-
-
-
(245)
(475)
(720)
29
(691)
Issue of ordinary shares
23
4
11
-
-
-
15
-
15
Share option expense
25
-
-
2
-
-
2
-
2
Disposal of a subsidiary
21
-
-
-
(41)
-
(41)
117
76
Transactions with owners, recognised
directly in equity
4
11
2
(41)
-
(24)
117
93
Balance at 31 December 2023
801
5,849
104
(106)
(3,465)
3,183
-
3,183
The notes on pages 32 to 63 are an integral part of these consolidated financial statements.
KERAS RESOURCES PLC
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 28
Notes
2024
£’000
2023
£’000
Cash flows from operating activities
Loss from operating activities
(753)
(446)
Adjustments for:
Depreciation and amortisation
14,15,16
86
139
Gain on sale of discontinued operations
21
-
(121)
Loss on disposal of subsidiary
21
-
76
Expenses settled in shares
-
-
Finance costs recognised
12
-
173
Share of losses of associated company
132
Equity-settled share-based payments
25
-
2
(535)
(177)
Changes in:
- inventory
90
9
- trade and other receivables
(147)
10
- trade and other payables
414
(392)
Cash generated by/(used in) operating activities
(178)
(550)
Finance costs
(208)
(17)
Finance income
125
-
Net cash generated by/(used in) operating activities
(261)
(567)
Cash flows from investing activities
Acquisition of property, plant and equipment
(1,133)
-
Acquisition of intangible fixed assets
(146)
-
Investment in associated company
(191)
-
Proceeds on disposal of discontinued operations
-
1,279
Settlement of deferred consideration for
purchase of minority interest in subsidiary*
17
(639)
(272)
Net cash used in investing activities
(2,109)
1,007
Cash flows from financing activities
Net proceeds from issue of share capital
23
377
15
Issue of promissory and convertible loan notes
2,081
-
Repayment of loans*
17
-
(357)
Payment of lease obligations
-
(126)
Net cash flows from financing activities
2,458
(468)
Net (decrease)/increase in cash and cash equivalents
88
(28)
Cash and cash equivalents at beginning of year
185
207
Foreign exchange differences etc
(24)
6
Cash and cash equivalents at 31 December
249
185
KERAS RESOURCES PLC
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 29
Changes in liabilities arising from financing activities
The table below details changes in the Group's liabilities arising from financing activities, including both cash
and non-cash changes. Liabilities arising from financing activities for which cash flows were, or future cash
flows will be, classified in the Group's Consolidated Statement of Cash Flows as cash flows from financing
activities.
At 1 January
2024
Cashflows
Acquired
Non-cash
movements
At 31
December 2024
Lease
liabilities
-
-
-
-
-
At 1 January
2023
Cashflows
Acquired
Non-cash
movements
At 31
December 2023
Lease
liabilities
126
(126)
-
-
-
*The deferred consideration payment is split between two lines being the element for the share investment
and the element for the loans novated as detailed in note 17.
The notes on pages 32 to 63 are an integral part of these consolidated financial statements.
KERAS RESOURCES PLC
COMPANY STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2024
Page 30
Notes
2024
£’000
2023
£’000
Assets
Investments
17
2,761
2,594
Non-current assets
2,761
2,594
Loans
18
2,814
2,781
Trade and other receivables
20
261
102
Cash and cash equivalents
67
73
Current assets
3,142
2,956
Total assets
5,903
5,550
Equity
Share capital
23
954
801
Share premium
23
6,073
5,849
Other reserves
23
116
104
Convertible loan reserve
23
116
-
Retained earnings
(3,012)
(2,553)
Total equity attributable to owners of the Company
4,247
4,201
Liabilities
Trade and other payables
26
843
818
Current liabilities
843
818
Trade and other payables
26
-
531
Loans and other borrowings
27
813
-
Non-current liabilities
813
531
Total liabilities
1,656
1,349
Total equity and liabilities
5,903
5,550
The Company has elected to take the exemption under Section 408 of the Companies Act 2006 from presenting
the Parent Company profit and loss account. The Parent Company loss for the year was £459,000 (2023: loss of
£363,000).
The financial statements of Keras Resources PLC, company number 07353748, were approved by the Board of
Directors and authorised for issue on 27 June 2025. They were signed on its behalf by:
Russell Lamming
Director
The notes on pages 32 to 63 are an integral part of these consolidated financial statements.
KERAS RESOURCES PLC
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 31
Share
capital
£‘000
Share
premium
£‘000
Share option
/warrant
reserve
£‘000
Convertible
loan notes
reserve
£’000
Retained
deficit
£‘000
Total
equity
£‘000
Balance at 1 January 2023
797
5,838
102
-
(2,190)
4,547
Loss for the year
-
-
-
-
(363)
(363)
Total comprehensive loss for the year
-
-
-
(363)
(363)
Issue of ordinary shares
4
11
-
-
-
15
Share option expense
-
-
2
-
-
2
Transactions with owners, recognised directly in equity
4
11
2
-
-
17
Balance at 31 December 2023
801
5,849
104
-
(2,553)
4,201
Balance at 1 January 2024
801
5,849
104
-
(2,553)
4,201
Loss for the year
-
-
-
-
(459)
(459)
Total comprehensive loss for the year
-
-
-
-
(459)
(459)
Issue of ordinary shares
153
224
-
-
-
377
Issue of convertible loan notes
-
-
-
116
-
116
Share option expense
-
-
12
-
-
12
Transactions with owners, recognised directly in equity
153
224
12
116
-
505
Balance at 31 December 2024
954
6,073
116
116
(3,012)
4,247
The notes on pages 32 to 63 are an integral part of these consolidated financial statements.
KERAS RESOURCES PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 32
1.
Reporting entity
Keras Resources PLC is a company domiciled in England and Wales. The address of the Company’s
registered office is Coveham House, Downside Bridge Road, Cobham KT11 3EP. The Group currently
operates as a miner of and explorer for mineral resources.
The Group consists of Keras Resources Plc and all of its subsidiaries.
2.
Going concern
The Directors have adopted the going concern basis in preparing the Group and Company financial
statements. The Group’s and Company’s business activities together with the factors likely to affect
its future development, performance and position are set out in the Chairman’s Statement and
Strategic Report. In addition, note 28 to the Financial Statements includes the Group’s policies and
processes for managing its financial risk management objectives.
Falcon Isle is currently generating positive cash flow, having completed its planned investments in
property and equipment. This cash flow is forecast to increase materially as a result of the Joint Venture
through Phosul Utah LLC, which company incurred start-up losses in 2024, but is forecasting positive
results for 2025. In addition, the agreement for the provision of advisory and brokerage services in the
Republic of Togo is expected to generate positive cash flow for Keras over the next three years.
Notwithstanding this, in order to meet the payment of $800,000 due on 1 July 2025 to the vendor of
Falcon Isle, and to provide additional working capital, on 25 June 2025 the Company announced that
it had raised a further £750,000 by the issue of convertible loan notes.
On this basis, the Directors have a reasonable expectation that the Group and Company will have
adequate resources to continue in operational existence for the foreseeable future. As such, the
Directors continue to adopt the going concern basis of accounting.
3.
Basis of preparation
(a)
Statement of compliance
The consolidated financial statements have been prepared in accordance with UK-adopted
international accounting standards in conformity with the Companies Act 2006(“UK-adopted IAS”),
and the Companies Act 2006 as applicable to entities reporting in accordance with IFRS.
(b)
Basis of measurement
The consolidated financial statements have been prepared on the historical cost basis unless
otherwise stated.
(c)
Functional and presentation currency
These consolidated financial statements are presented in Pounds Sterling (‘GBP’ or ‘£’), which is the
Group’s functional currency and is considered by the Directors to be the most appropriate
presentation currency to assist the users of the financial statements. All financial information presented
in GBP has been rounded to the nearest thousand, except when otherwise indicated.
(d)
Basis of parent company preparation
The parent company meets the definition of a qualifying entity under FRS 101 Reduced Disclosure
Framework.
As permitted by FRS 101, the Company has taken advantage of the following disclosure exemptions
from the requirements of IFRS:
(a) the requirements of IFRS 7 'Financial Instruments: Disclosure';
(b) the requirements within IAS 1 relating to the presentation of certain comparative information;
(c) the requirements of IAS 7 'Statement of Cash Flows' to present a statement of cash flows;
KERAS RESOURCES PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 33
(d) Basis of parent company preparation (continued)
(d) paragraphs 30 and 31 of IAS 8 'Accounting policies, changes in accounting estimates and errors'
(requirement for the disclosure of information when an entity has not applied a new IFRS that has been
issued but it not yet effective); and
(e) the requirements of IAS 24 'Related Party Disclosures' to disclose related party transactions and
balances between two or more members of a Group.
(e)
Use of estimates and judgements
The preparation of the consolidated financial statements in conformity with IFRS requires
management to make judgements, estimates and assumptions that affect the application of
accounting policies and the reported amounts of assets, liabilities, income and expenses. The
estimates and associated assumptions are based on historical experience and various other factors
that are believed to be reasonable under the circumstances, the results of which form the basis of
making judgements about carrying values of assets and liabilities that are not readily apparent from
other sources. Actual results may differ from these estimates.
Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting
estimates are recognised in the period in which the estimates are revised if the revision affects only
that period, or in the period of revision and future periods of the revision if it affects both current and
future periods.
Critical estimates and assumptions that have the most significant effect on the amounts recognised
in the consolidated financial statements and/or have a significant risk of resulting in a material
adjustment within the next financial year are as follows:
Deferred consideration and the loan payable to previous minority shareholder in subsidiary company
The deferred consideration due in respect of the acquisition of the remaining 49% of Falcon Isle
Resources LLC was discounted at a rate of 12% being the rate at which interest will accrue in the
event of a default. This discount has been fully unwound at 31 December 2024. Further details can be
found in Note 17.
Carrying value of intangible assets
Intangible assets consists of prospecting and exploration rights. Those acquired with subsidiaries are
recognised at fair value at the date of acquisition. Other rights acquired and evaluation expenditure
are recognised at cost. The directors assess the recoverable value at each year end and review for
any signs of impairment.
Impairment of intangible assets
Intangible assets have been assessed during the current year for any impairment and it was
concluded that they are fairly valued. The recoverable amount from the cash generating unit (CGU),
in the USA, was assessed by performing a 10-year discounted cashflow (DCF) model and it was
concluded that the recoverable amounts exceeded the intangible asset value indicating no
impairment.
Key assumptions
The recoverable amount for the CGU is based on value-in-use which is derived from discounted cash
flow calculations. The key assumptions applied in value-in-use calculations are those regarding
forecast mine production, sales per production, sales per product type, operating profit, phosphate
prices and discount rates.
Forecast operating profits
For the CGU, the Group prepared cash flow projections derived from the most recent forecast for the
year ending 31 December 2025, Forecast revenue, fixed and variable costs are based on recent
performance and expectations of future changes in the market, operating model and cost base.
KERAS RESOURCES PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 34
3. Basis of preparation (continued)
Growth rates
For the short term, sales are forecast to grow by approximately $1.5m in each of 2025 and 2026,
primarily due to the PhoSul Utah LLC JV as explained in the Chairman’s Statement and the Strategic
Report. For the medium term, the forecasts have taken a conservative approach and assumed that
sales will not grow any further and will remain at the same level from 2027 onwards.
Discount rates
A post-tax real discount rate used to assess the forecast free cashflows from the CGU was derived
from its weighted average cost of capital, taking into account specific factors relating to the country
is operates in. These rates are reviewed annually and adjusted for the risks specific to the business
being assessed and the market in which the CGU operates. The real post-tax discount rate used during
the year for the USA was 10%.
Sensitivity analysis
A sensitivity analysis on the key model parameters has been performed and management has
concluded that no reasonably foreseeable change in the key assumptions would result in an
impairment of the intangible assets of the Group’s CGU.
Assets held for sale
On classification as held-for-sale, assets and disposal groups are measured at the lower of the
carrying amount and fair value less costs to sell, with any adjustments taken to profit or loss (or other
comprehensive income in the case of a revalued asset).
Intercompany receivables (Company only)
All loans to subsidiaries are currently unsecured and interest free and repayable on demand.
Fair value of share options and warrants
The determination of the fair values of the schemes issued have been made with reference to the
Black-Scholes model with the inputs set out in Note 25.
4.
Significant accounting policies
The accounting policies set out below have been applied consistently to all periods presented in these
consolidated financial statements and have been applied consistently by Group entities.
(a)
Basis of consolidation
(i)
Business combinations
The Group accounts for business combinations using the acquisition method when control is
transferred to the Group. The consideration transferred in the acquisition is generally measured at fair
value, as are identifiable net assets acquired. Any goodwill that arises is tested annually for
impairment. Any gain on a bargain purchase is recognised in profit or loss immediately. Transaction
costs are expensed as incurred, except if related to the issue of debt or equity securities. The
consideration transferred does not include amounts related to the settlement of pre-existing
relationships. Such amounts generally are recognised in profit or loss.
(ii)
Subsidiaries
Subsidiaries are entities controlled by the Group. The Group controls an entity when it is exposed to,
or has rights to, variable returns from its involvement with the entity and has the ability to affect those
returns through its power over the entity. The financial statements of subsidiaries are included in the
consolidated financial statements from the date that control commences until the date that control
ceases. On disposal of subsidiaries, any amounts previously recognised in other comprehensive
income in respect of that entity are accounted for as if the Group had directly disposed of the related
assets or liabilities. This might mean that amounts previously recognised in other comprehensive
income are reclassified to profit or loss.
KERAS RESOURCES PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 35
(iii) Transactions eliminated on consolidation
Intra-group balances and transactions, and any unrealised income and expenses arising from intra-
group transactions, are eliminated in preparing the consolidated financial statements.
(b)
Foreign currency
Transactions in foreign currencies are translated into the respective functional currencies of Group
entities at exchange rates at the dates of the transactions. Monetary assets and liabilities
denominated in foreign currencies are translated into the functional currency at the reporting date.
Non-monetary assets and liabilities denominated in foreign currencies that are measured at fair value
in a foreign currency are translated to the functional currency at the exchange rate when the fair
value was determined. Non-monetary items that are measured based on historical cost in a foreign
currency are translated at the exchange rate at the date of the transaction.
(i)
Foreign operations
The assets and liabilities of foreign operations, including goodwill and the fair value adjustments arising
on acquisition, are translated to GBP at exchange rates at the reporting date. The income and
expenses of foreign operations are translated to GBP at exchange rates at the dates of the
transactions.
Foreign currency differences are recognised in other comprehensive income and accumulated in the
translation reserve except to the extent that the translation difference is allocated to non-controlling
interests. When a foreign operation is disposed of in its entirety or partially such that control, significant
influence or joint control is lost, the cumulative amount in the translation reserve related to that foreign
operation is reclassified to profit or loss as part of the gain or loss on disposal. If the Group disposes of
part of its interest in a subsidiary but retains control, then the relevant proportion of the cumulative
amount is reattributed to non-controlling interests. When the Group disposes of only part of an
associate or joint venture while retaining significant influence or joint control, the relevant proportion
of the cumulative amount is reclassified to profit or loss.
(c)
Financial instruments
(i)
Financial assets
The Group’s financial assets measured at amortised cost comprise trade and other receivables, cash
and cash equivalents and financial assets at fair value through other comprehensive income in the
consolidated statement of financial position.
Trade receivables and intra group balances are initially recognised at fair value. New impairment
requirements use an expected credit loss model to recognise an allowance. For receivables a
simplified approach to measure expected credit losses during a lifetime expected loss allowance is
available and has been adopted by the Group. During this process the probability of non-payment
of the receivables is assessed. This probability is then multiplied by the amount of the expected loss
arising from default to determine the lifetime expected credit loss for the receivables. For trade
receivables, which are reported net, such provisions are recorded in a separate provision account
with the loss being reported within the consolidated statement of comprehensive income. On
confirmation that the trade and intra group receivable will not be collectable, the gross carrying value
of the asset is written off against the provision.
KERAS RESOURCES PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 36
(ii)
Non-derivative financial liabilities
The Group initially recognises debt securities issued and subordinated liabilities on the date that they
are originated. All other financial liabilities are recognised initially on the trade date, which is the date
that the Group becomes a party to the contractual provisions of the instrument.
The Group derecognises a financial liability when its contractual obligations are discharged,
cancelled or expire. The Group classifies non-derivative financial liabilities into the other financial
liabilities category. Such financial liabilities are recognised initially at fair value less any directly
attributable transaction costs. Subsequent to initial recognition, these financial liabilities are measured
at amortised cost using the effective interest method. Other financial liabilities comprise trade and
other payables.
(iii)
Share capital
Ordinary shares
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of ordinary
shares are recognised as a deduction from equity, net of any tax effects.
(d)
Property, plant and equipment
(i)
Recognition and measurement
Items of property, plant and equipment are measured at cost less accumulated depreciation and
any accumulated impairment losses. Cost includes expenditure that is directly attributable to the
acquisition of the asset.
When parts of an item of property, plant and equipment have different useful lives, they are
accounted for as separate items (major components) of property, plant and equipment.
Any gain or loss on disposal of an item of property, plant and equipment (calculated as the difference
between the net proceeds from disposal and the carrying amount of the item) is recognised in profit
or loss.
(ii)
Subsequent expenditure
Subsequent expenditure is capitalised only when it is probable that the future economic benefits
associated with the expenditure will flow to the Group. Ongoing repairs and maintenance is
expensed as incurred.
(iii)
Depreciation
Items of property, plant and equipment are depreciated on a straight-line basis in the statement of
comprehensive income over the estimated useful lives of each component.
Items of property, plant and equipment are depreciated from the date that they are installed and
are ready for use, or in respect of internally constructed assets, from the date that the asset is
completed and ready for use.
The estimated useful lives of significant items of property, plant and equipment are as follows:
•
Freehold property
50 years
•
plant and equipment
20 years
•
office equipment
2 years
•
computer equipment
2 years
•
motor vehicles
5 years
Depreciation methods, useful lives and residual values are reviewed at each reporting date and
adjusted if appropriate.
KERAS RESOURCES PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 37
(e)
Intangible assets
(i)
Prospecting and exploration rights
Rights acquired with subsidiaries are recognised at fair value at the date of acquisition. Other rights
acquired and evaluation expenditure are recognised at cost.
(ii)
Other intangible assets
Other intangible assets that are acquired by the Group and have finite useful lives are measured at
cost less accumulated amortisation and any accumulated impairment losses.
(iii)
Subsequent expenditure
Subsequent expenditure is capitalised only when it increases the future economic benefits embodied
in the specific asset to which it relates. All other expenditure, including expenditure on internally
generated goodwill and brands, is recognised in profit or loss as incurred.
(iv)
Amortisation
Intangible assets are amortised in profit or loss over their estimated useful lives, from the date that they
are available for use.
The estimated useful lives are as follows:
•
Life of mine based on units of production
Amortisation methods, useful lives and residual values are reviewed at each reporting date and
adjusted if appropriate.
Amortisation is included within administrative expenses in the statement of comprehensive income.
(f)
Impairment
(i)
Non-derivative financial assets
A financial asset not classified as at fair value through profit or loss is assessed at each reporting date
to determine whether there is objective evidence that it is impaired. A financial asset is impaired if
there is objective evidence of impairment as a result of one or more events that occurred after the
initial recognition of the asset, and had an impact on the estimated future cash flows from that asset
that can be estimated reliably.
Objective evidence that financial assets are impaired includes default or delinquency by a debtor,
restructuring of an amount due to the Group on terms that the Group would not consider otherwise,
indications that a debtor or issuer will enter bankruptcy, adverse changes in the payment status of
borrowers or issuers, economic conditions that correlate with defaults or the disappearance of an
active market for a security. In addition, for an investment in an equity security, a significant or
prolonged decline in its fair value below its cost is objective evidence of impairment.
Financial assets measured at amortised cost
The Group considers evidence of impairment for financial assets measured at amortised cost (loans
and receivables) at both a specific asset and collective level. All individually significant assets are
assessed for specific impairment. Those found not to be specifically impaired are then collectively
assessed for any impairment that has been incurred but not yet identified. Assets that are not
individually significant are collectively assessed for impairment by grouping together assets with similar
risk characteristics.
KERAS RESOURCES PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 38
4. Significant accounting policies (continued)
In assessing collective impairment, the Group uses historical trends of the probability of default, the
timing of recoveries and the amount of loss incurred, adjusted for management’s judgement as to
whether current economic and credit conditions are such that the actual losses are likely to be greater
or less than suggested by historical trends.
An impairment loss in respect of a financial asset measured at amortised cost is calculated as the
difference between its carrying amount and the present value of the estimated future cash flows
discounted at the asset’s original effective interest rate. Losses are recognised in profit or loss and
reflected in an allowance against loans and receivables. Interest on the impaired asset continues to
be recognised. When an event occurring after the impairment was recognised causes the amount
of impairment loss to decrease, the decrease in impairment loss is reversed through profit or loss.
Financial assets at fair value through other comprehensive income
Impairment losses on financial assets at FVOCI are recognised by reclassifying the losses accumulated
in the fair value reserve to profit or loss. The amount reclassified is the difference between the
acquisition cost (net of any principal repayment and amortisation) and the current fair value, less any
impairment previously recognised in profit or loss. Impairment losses recognised in profit or loss for an
investment in an equity instrument classified as FVOCI are not reversed through profit or loss.
(ii)
Non-financial assets
The carrying amounts of the Group’s non-financial assets are reviewed at each reporting date to
determine whether there is any indication of impairment. If any such indication exists, the asset’s
recoverable amount is estimated. Indefinite-lived intangible assets are tested annually for impairment
or when there is an indication of impairment. An impairment loss is recognised if the carrying amount
of an asset or Cash Generating Unit (‘CGU’) exceeds its recoverable amount.
The recoverable amount of an asset of CGU is the greater of its value in use and its fair value less costs
to sell. In assessing value in use, the estimated future cash flows are discounted to their present value
using a pre-tax discount rate that reflects current market assessments of the time value of money and
the risks specific to the asset or CGU. For the purpose of impairment testing, assets are grouped
together into the smallest group of assets that generates cash inflows from continuing use that are
largely independent of the cash inflows of other assets or CGUs. Subject to an operating segment
ceiling test, CGUs to which goodwill has been allocated are aggregated so that the level at which
impairment testing is performed reflects the lowest level at which goodwill is monitored for internal
reporting purposes. Goodwill acquired in a business combination is allocated to groups of CGUs that
are expected to benefit from the synergies of the combination.
Impairment losses are recognised in profit or loss. Impairment losses recognised in respect of CGUs
are allocated first to reduce the carrying amount of any goodwill allocated to the CGU (group of
CGUs), and then to reduce the carrying amounts of the other assets in the CGU (group of CGUs) on
a pro rata basis.
An impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed
the carrying amount that would have been determined, net of depreciation or amortisation, if no
impairment loss had been recognised.
(g)
Employee benefits
costs of short-term employee benefits are recognised as a liability and an expense, unless those costs
are required to be recognised as part of the cost of stock or non-current assets The cost of any unused
holiday entitlement is recognised in the period in which the employee’s services are received.
Termination benefits are recognised immediately as an expense when the company is demonstrably
committed to terminate the employment of an employee or to provide termination benefits.
KERAS RESOURCES PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 39
Share-based payments
The grant-date fair value of share-based payment awards granted to employees is recognised as an
employee expense, with a corresponding increase in equity, over the period that the employees
become unconditionally entitled to the awards. The amount recognised as an expense is adjusted to
reflect the number of awards for which the related service and non-market performance conditions
are expected to be met, such that the amount ultimately recognised as an expense is based on the
number of awards that meet the related service and non-market performance conditions at the
vesting date. For share-based payment awards with non-vesting conditions, the grant-date fair value
of the share-based payment is measured to reflect such conditions and there is no adjustment for
differences between expected and actual outcomes.
(h)
Retirement benefits
A defined contribution plan is a post-employment benefit plan under which the group pays fixed
contributions into a separate entity and will have no legal or constructive obligation to pay further
amounts. Obligations for contributions to defined contribution pension plans are recognised as an
expense in the profit and loss account in the periods during which services are rendered by
employees.
(i)
Revenue
Turnover represents the amounts (net of VAT and trade discounts) receivable from the provisions of
goods and services to the customer during the period.
The Group applies IFRS 15 ‘Revenue from contracts with customers’. Under IFRS 15, the Group applies
the 5-step method to identify contracts with its customers, determine performance obligations arising
under those contracts, set an expected transaction price, allocate that price to the performance
obligations, and then recognises revenues as and when those obligations are satisfied.
Revenue from the sale of processed products is recognised when ownership of the product passes to
the purchaser in accordance with the relevant sales contract. Ownership passes either upon delivery
or once the product is collected where customers arrange delivery.
IFRS 15 Revenue from contracts with customers
IFRS 15 establishes a comprehensive ‘5 step’ framework for determining whether, how much and when
revenue is recognised. Under IFRS 15, revenue is recognised when a customer obtains control of the
goods or services. Determining the timing of the transfer of control – at a point in time or over time –
requires judgement.
Under IFRS 15, sales are recognised when control of the products has transferred, being when the
products are delivered to the customer, the customer has full discretion of the usage of the projects,
and there are no unfulfilled obligation which could affect the customers’ acceptance of the products
and when the entity has a present right to payment for the asset. Delivery occurs when the products
are delivered to a specific location and erected at that location, the risks have been transferred and
the customer has accepted the products in accordance with the sales agreement.
A receivable is recognised when control transfers as this is the point in time that the consideration is
unconditional because only the passage of time is required before the payment is due.
No element of financing is deemed present as the sales are typically made with a credit term of 30
days from invoice date, which is consistent with market practice.
KERAS RESOURCES PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 40
(j)
Finance income and finance costs
Finance income comprises interest income on bank funds. Interest income is recognised as it accrues
in profit or loss, using the effective interest method.
In addition, finance income includes rent receivable in respect of the lease of property and
equipment in Utah, USA. The lease is with the associated company, Phosul Utah LLC, and the income
is recognised on an accruals basis.
Finance costs comprise interest expense on borrowings. Borrowing costs are recognised in profit or loss
in the period in which they are incurred.
(k)
Taxation
Tax expense comprises current and deferred tax. Current and deferred tax is recognised in profit or
loss except to the extent that it relates to a business combination, or items recognised directly in equity
or in other comprehensive income.
Current tax is the expected tax payable or receivable on the taxable income or loss for the year, using
tax rates enacted or substantially enacted at the reporting date, and any adjustment to tax payable
in respect of previous years. Current tax payable also includes any tax liability arising from the
declaration of dividends.
Deferred tax is recognised in respect of temporary differences between the carrying amounts of assets
and liabilities for financial reporting purposes and the amounts used for taxation purposes. Deferred
tax is not recognised for:
•
temporary differences on the initial recognition of assets or liabilities in a transaction that is not
a business combination and that affects neither accounting nor taxable profit or loss;
•
temporary differences related to investments in subsidiaries and jointly controlled entities to
the extent that it is probable that they will not reverse in the foreseeable future; and
•
taxable temporary differences arising on the initial recognition of goodwill.
Deferred tax is measured at the tax rates that are expected to be applied to temporary differences
when they reverse, using tax rates enacted or substantively enacted at the reporting date.
Deferred tax assets and liabilities are offset if there is a legally enforceable right to offset current tax
liabilities and assets, and they relate to taxes levied by the same tax authority on the same taxable
entity, or on different tax entities, but they intend to settle current tax liabilities and assets on a net basis
or their tax assets and liabilities will be realised simultaneously.
Deferred tax assets are recognised for unused tax losses, unused tax credits and deductible temporary
differences to the extent that it is probable that future taxable profits will be available against which
they can be used. Deferred tax assets are reviewed at each reporting date and are reduced to the
extent that it is no longer probable that the related tax benefit will be realised; such reductions are
reversed when the probability of future taxable profits improves.
(l)
Inventories
Inventories for processed material and ore stockpiles are valued at the lower of cost and net realisable
value. Costs allocated to processed material are based on average costs and include all costs of
purchase, conversion and other costs in bringing these inventories to their existing location and
condition. Costs allocated to ore stockpiles are based on average costs, which include an
appropriate share of direct mining costs, direct labour and material costs, mine site overhead,
depreciation and amortisation. If carrying value exceeds net realisable amount, a write down is
KERAS RESOURCES PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 41
recognised. The write down may be reversed in a subsequent period if the circumstances which
caused it no longer exist.
(m)
Segment reporting
Segment results that are reported to management include items directly attributable to a segment as
well as those that can be allocated on a reasonable basis.
(n)
Equity reserves
Share premium includes any premiums received on issue of share capital. Any transaction costs
associated with the issue of shares are deducted from share premium.
The share option/warrant reserve is used to recognise the fair value of equity-settled share based
payment transactions.
The exchange reserve is used to record exchange differences arising from the translation of foreign
subsidiaries into the presentation currency.
The financial assets at FVOCI reserve is used to record unrealised accumulated changes in fair value
on financial assets.
(o)
Discontinued operation
A discontinued operation is a component of the Group’s business, the operations and cash flows of
which can be clearly distinguished from the rest of the Group and which:
•
represents a separate major line of business or geographic area of operations;
•
is part of a single co‑ordinated plan to dispose of a separate major line of business or
geographic area of operations; or
•
is a subsidiary acquired exclusively with a view to resale.
Classification as a discontinued operation occurs at the earlier of disposal or when the operation
meets the criteria to be classified as held‑for‑sale.
When an operation is classified as a discontinued operation, the comparative statement of profit or
loss and OCI is re‑presented as if the operation had been discontinued from the start of the
comparative year.
KERAS RESOURCES PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 42
5.
New standards and interpretations
The current standards, amendments and interpretations have been adopted in the year and have
not had a material impact on the reported results in the Company's financial statements:
•
Amendments to IFRS 16 Leases: Lease Liability in a Sale and Leaseback
•
Amendments to IAS 1: Classification of Liabilities as Current or Non-current
•
Amendments to IAS 7 and IFRS 7 – Supplier Finance Agreements
The adoption of the following mentioned standards, amendments and interpretations in future years:
The directors have undertaken a project to review the above standards, amendments and
interpretations. Management do not expect these standards to materially impact the financial
statements.
6.
Determination of fair values
A number of the Group’s accounting policies and disclosures require the determination of fair value,
for both financial and non-financial assets and liabilities. Fair values have been determined for
measurement and/or disclosure purposes based on the following methods. When applicable further
information about the assumptions made in determining fair values is disclosed in the notes specific to
that asset or liability.
(i)
Property, plant and equipment
The fair value of property, plant and equipment recognised as a result of a business combination is
the estimated amount for which a property could be exchanged on the date of acquisition between
a willing buyer and a willing seller in an arm’s length transaction after proper marketing wherein the
parties had each acted knowledgeably. The fair value of items of plant and equipment is based on
the market approach and cost approaches using quoted market prices for similar items when
available and depreciated replacement cost when appropriate. Depreciated replacement cost
reflects adjustments for physical deterioration as well as functional and economic obsolescence.
(ii)
Intangible assets
The fair value of other intangible assets is based on the discounted cash flows expected to be derived
from the use and eventual sale of the assets.
(iii)
Trade and other receivables
The fair value of trade and other receivables is estimated at the present value of future cash flows,
discounted at the market rate of interest at the reporting date. This fair value is determined for
disclosure purposes or when such assets are acquired in a business combination.
(iv)
Share-based payments
The fair value of the employee share options is measured using the Black-Scholes formula.
Measurement inputs include the share price on the measurement date, the exercise price of the
instrument, expected volatility (based on an evaluation of the Company’s historic volatility,
particularly over the historic period commensurate with the expected term), expected term of the
instruments (based on historical experience and general option holder behaviour), expected
dividends, and the risk-free interest rate (based on government bonds). Service and non-market
performance conditions attached to the transactions are not taken into account in determining fair
value.
Effective date – period beginning on or after
Lack of Exchangeability (Amendments to IAS 1)
1 January 2025
IFRS 18 Presentation and disclosure in Financial Statements
1 January 2027
IAS 7 Statement of Cash Flows
1 January 2027
KERAS RESOURCES PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 43
(v)
Investments – other
When one is available, the Group measures the fair value of an instrument using the quoted price in
an active market for that instrument. A market is regarded as active if transactions for the asset or
liability take place with sufficient frequency and volume to provide pricing information on an ongoing
basis. A discount is applied to the value of any Performance shares to reflect the possibility that the
milestones for conversion into ordinary shares may not be met.
7.
Revenue
Revenue comprises:
Group:
2024
2023
£’000
£’000
Sale of phosphate (USA)
1,119
916
1,119
916
8.
Operating segments
The Group considers that it operated during the year in a single business area, being that of phosphate
mining in Utah, USA. In the previous year the Group also operated in manganese exploration and
development in West Africa. These business areas formed the basis of the Group’s operating
segments. For each segment, the Group’s CEO (the chief operating decision maker) reviewed
internal management reports on at least a quarterly basis.
Other operations relate to the Group’s administrative functions conducted at its head office and by
its intermediate holding company together with consolidation adjustments.
Information regarding the results of each reportable segment is included below. Performance is
measured based on segment result before tax, as included in the internal management reports that
are reviewed by the Group’s CEO. Segment results are used to measure performance as
management believes that such information is the most relevant in evaluating the performance of
certain segments relative to other entities that operate within the exploration industry.
Information about reportable segments
31 December 2024
Phosphate
£’000
Other
operations
£’000
Total
£’000
External revenue
1,119
-
1.119
Cost of sales
826
-
826
Depreciation,
amortisation and
impairment
85
-
85
(Loss)/profit before
Tax
(104)
(649)
(753)
Gross assets
including non-
current and
current assets
5,317
836
6,153
Capital
expenditure
4,996
-
4,996
Liabilities
1,748
1,454
3,202
KERAS RESOURCES PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 44
8.
Operating segments (continued)
31 December 2023
Manganese
£’000
Phosphate
£’000
Other
operations
£’000
Total
£’000
External revenue
-
916
-
916
Cost of Sales
-
386
-
386
Depreciation,
amortisation and
impairment
-
139
-
139
(Loss)/profit before tax
29
(3)
(466)
(440)
Gross assets
including non-
current and current
assets
-
4,646
81
4,727
Capital expenditure
-
3,404
-
3,404
Liabilities
-
290
1,254
1,544
Information about geographical segments
31 December 2024
US
£’000
Other
£’000
Total
£’000
External revenue
1,119
-
1,119
Cost of sales
826
-
826
Depreciation,
amortisation and
impairment
85
-
85
(Loss)/profit before
tax
(104)
(649)
(753)
Gross assets including
non-current and
current assets
5317
836
6,153
Capital expenditure
4,996
-
4,996
Liabilities
1,748
1,454
3,202
KERAS RESOURCES PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 45
8.
Operating segments (continued)
31 December 2023
West
Africa
£’000
US
£’000
Other
£’000
Total
£’000
External revenue
-
916
-
916
Cost of Sales
-
386
-
386
Depreciation,
amortisation and
impairment
-
139
-
139
(Loss)/profit before tax
29
(3)
(466)
(440)
Gross assets including
non-current and
current assets
-
4,646
81
4,727
Capital expenditure
-
3,404
-
3,404
Liabilities
-
290
1,254
1,544
9.
Expenses
Expenses include:
2024
£‘000
2023
£‘000
Depreciation and amortisation expense
85
139
(Profit) on sale of intellectual property relating to Togo
-
(121)
Loss on disposal of subsidiary
-
76
Auditor’s remuneration
- Audit fee
28
25
Foreign exchange differences
(42)
(135)
Auditor’s remuneration for the year in respect of the Company amounted to £15,000 (2023: £15,000).
10.
Personnel expenses
2024
£‘000
2023
£‘000
Wages and salaries
165
193
Social security costs
11
12
Pension costs
-
2
Fees
153
142
Equity-settled share-based payments (see note 26)
11
2
340
351
The average number of employees (including directors) during the year was:
2024
2023
Directors
4
4
Administrative staff
1
1
5
5
KERAS RESOURCES PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 46
11.
Directors’ emoluments
Year ended 31 December 2024
Executive
directors
£’000
Non-
executive
directors
£‘000
Total
£‘000
Wages and salaries (incl. fees)
153
108
261
153
108
261
Year ended 31 December 2023
Executive
directors
£’000
Non-
executive
directors
£‘000
Total
£‘000
Wages and salaries (incl. fees)
269
60
329
269
60
329
These amounts are disclosed by director in the Directors’ report.
Emoluments disclosed above include the following amounts payable to the highest paid director:
2024
£‘000
2023
£’000
Emoluments for qualifying services
153
142
12.
Finance costs
Recognised in loss for year
2024
£‘000
2023
£‘000
Discount unwinding on deferred consideration and
loan payable to previous minority shareholder
133
156
Interest on convertible loans
74
Other
1
17
208
173
The Discount unwinding disclosed above relates to the deferred consideration explained in note 17.
KERAS RESOURCES PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 47
13.
Taxation
Current tax
2024
£‘000
2023
£‘000
Tax recognised in profit or loss
Current tax
Current period
-
6
Deferred tax
Origination and reversal of temporary differences
-
-
Total tax
-
6
Reconciliation of effective tax rate
2024
£’000
2023
£’000
Loss before tax (continuing operations)
(753)
(446)
Tax using the Company’s domestic tax rate of 19.0% (2023:
19.0%)
(143)
(85)
Effects of:
Expenses not deductible for tax purposes
1
32
Overseas (profits)/losses
20
6
Equity-settled share-based payments
2
-
Tax losses carried forward not recognised as a deferred tax asset
120
53
-
6
The UK corporation tax rate was 19.00% until April 2023 when it increased to 25% for groups with
taxable profits of over £250,000.
None of the components of other comprehensive income have a tax impact.
Factors that may affect future tax charges
At the year end, the Group had unused tax losses available for offset against suitable future profits
of approximately £8,818,000 (2023: £8,186,000). A deferred tax asset has not been recognised in
respect of such losses due to uncertainty of future profit streams.
KERAS RESOURCES PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 48
14.
Property, plant and equipment
Group
Freehold
Property
£’000
Plant and
equipment
£’000
Office and
computer
equipment
£’000
Total
£’000
Cost
Balance at 1 January 2023
-
397
12
409
Effect of movements in exchange rates
-
(22)
-
(22)
Balance at 31 December 2023
-
375
12
387
Balance at 1 January 2024
-
375
12
387
Purchases
559
574
-
1,133
Effect of movements in exchange rates
-
11
-
11
Balance at 31 December 2024
559
960
12
1,531
Depreciation and impairment provisions
Balance at 1 January 2023
-
17
11
28
Depreciation for the year
-
13
1
14
Effect of movements in exchange rates
-
(1)
-
(1)
Balance at 31 December 2023
-
29
12
41
Balance at 1 January 2024
-
29
12
41
Depreciation for the year
11
52
-
63
Effect of movements in exchange rates
-
5
-
5
Balance at 31 December 2024
11
86
12
109
Carrying amounts
At 31 December 2022
-
380
1
381
At 31 December 2023
-
346
-
346
At 31 December 2024
548
874
-
1,422
Depreciation is recognised within administrative expenses.
KERAS RESOURCES PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 49
14.
Property, plant and equipment (continued)
Company
Computer
equipment
£’000
Cost
Balance at 1 January 2023
8
Transfers
-
Balance at 31 December 2023
8
Balance at 1 January 2024
8
Additions
-
Balance at 31 December 2024
8
Depreciation and impairment provisions
Balance at 1 January 2023
8
Depreciation for the year
-
Balance at 31 December 2023
8
Balance at 1 January 2024
8
Depreciation for the year
-
Balance at 31 December 2024
8
Carrying amounts
At 31 December 2023
-
At 31 December 2024
-
KERAS RESOURCES PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 50
15.
Right of use assets
Group
Land and
buildings
£’000
Cost
Balance at 1 January 2023
353
Effects of movements in exchange rates
(11)
Balance at 31 December 2023
342
Balance at 1 January 2024
342
Disposal
(342)
Balance at 31 December 2024
-
Depreciation and impairment provisions
Balance at 1 January 2023
232
Depreciation for the year
117
Effects of movements in exchange rates
(7)
Balance at 31 December 2023
342
Balance at 1 January 2024
342
Depreciation for the year
(342)
Effect of movements in exchange rates
-
Balance at 31 December 2024
-
Carrying amounts
At 31 December 2022
121
At 31 December 2023
-
At 31 December 2024
-
Depreciation is recognised within administrative expenses.
KERAS RESOURCES PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 51
16.
Intangible assets – Group
Prospecting
and
exploration
rights
£’000
Cost
Balance at 1 January 2023
3,613
Effect of movement in exchange rates
(149)
Balance at 31 December 2023
3,464
Balance at 1 January 2024
3,464
Purchases
146
Effect of movements in exchange rates
47
Balance at 31 December 2024
3,657
Amortisation and impairment losses
Balance at 1 January 2023
55
Amortisation charge
8
Effect of movements in exchange rates
(3)
Balance at 31 December 2023
60
Balance at 1 January 2024
60
Amortisation charge
22
Effect of movements in exchange rates
1
Balance at 31 December 2024
83
Carrying amounts
At 31 December 2022
3,558
At 31 December 2023
3,404
At 31 December 2024
3,574
The carrying value of the prospecting and exploration rights is supported by the estimated
resource and current market values. The Group tests intangible assets for impairment annually.
There were no indicators of impairment at 31 December 2024.
Amortisation is recognised within administrative expenses.
KERAS RESOURCES PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 52
17.
Investments in subsidiaries and associates
Company – subsidiaries
2024
£’000
2023
£’000
Equity investments
Balance at beginning of year
2,594
2,594
Additions – Increased investment in Falcon Isle
Resources LLC
167
-
Balance at 31 December:
2,761
2,594
Country of
Ownership interest
Activity
incorporation
2024
2023
Directly
Southern Iron Limited
Investment
Guernsey
100%
100%
Falcon Isle Resources LLC
Mining
USA
100%
100%
Keras US LLC
Holding company
USA
100%
100%
Indirectly
Falcon Isle Holdings LLC
Holding company
USA
100%
100%
Registered offices of subsidiary companies are:
•
Southern Iron Limited, 1st Floor, Elizabeth House, Les Ruettes Brayes, St Peter Port,
Guernsey
•
Falcon Isle Resources Corp, Falcon Isle Holdings LLC and Keras US LLC, 50 West
Broadway Suite 300, Salt Lake City, Utah 84101, USA
The interest in Falcon Isle was acquired for nominal consideration under a binding heads of terms
dated 28 July 2020. Under this agreement the Company agreed to provide US$2.5m in loans to
Falcon Isle payable in agreed tranches. Falcon Isle is the 100% owner of the Diamond
Creek phosphate mine located in in Utah (USA) which is a fully permitted, high grade direct shipping
ore organic phosphate operating mine.
At 30 September 2020 the Company had advanced US$ 1.9m to Falcon Isle, resulting in an equity
interest of 40% and bringing the cost of the investment in the associate to £1,626,000.
On 31 December 2020 the Company advanced the balance of $0.6m and its equity interest has
increased to a controlling interest of 51%.
The initial acquisitions were accounted for under the equity method of accounting but upon
achieving control on 31 December 2020, the acquisition method of accounting has been applied.
The investment in associate was revalued prior to acquisition to fair value based on the price paid
to acquire the additional 11% shareholding. Under IFRS 3, on acquisition of the controlling stake,
the Group remeasured its original 40% investment in Falcon Isle. This led to a loss on change of
ownership of £363,000 being recognised in the Consolidated Statement of Comprehensive
Income.
On acquisition the non-controlling interest, valued based upon net assets at acquisition, was
valued at £645,000. No goodwill has arisen from the acquisition.
KERAS RESOURCES PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 53
17.
Investments in subsidiaries and associates (continued)
On 29 March 2022, the Company agreed to acquire the outstanding 49% equity interest in Falcon
Isle for consideration of $1,383,473 and loans totalling $1,816,527 made by the vendor to Falcon
Isle, for total consideration of $3.2 million, payable in four annual tranches of $800,000
commencing on 1July 2022 and as such the deferred consideration and loan due to the vendor
has been discounted at 12% with the discount being applied against the investment in full. This
discount had been fully unwound at 31 December 2024. The non-controlling interest was
eliminated against the consideration with the remaining balance of £199,311 transferred to
retained earnings.
The cashflow impact of this acquisition for year ended 31 December 2024, is the third instalment
of $800,000. The final instalment of $800,000 is payable on 1 July 2025.
On 29 December 2023, the group disposed of all its 85% shareholding in Société Générale des
Mines, as detailed in note 21.
Group - Associated Company
50% interest in Phosul Utah LLC, incorporated in Utah, USA.
2024
£’000
2023
£’000
50% equity interest at cost
191
-
Share of post-acquisition losses
(132)
-
Exchange translation
(2)
-
57
-
The registered address of Phosul Utah LLC is 3701 West 6500 North, Delta, UT 84624. On 22 January
2024 Keras Resources plc announced the signature of a five year 50:50 Joint Venture Agreement
("JV") between its wholly owned subsidiary, Falcon Isle Resources Corp ("FIR") and Phosul LLC
("Phosul"), a specialised organic soil enhancement fertilizer company with granulator operations
in Idaho, United States ("US"). FIR holds 50% of the membership interest in Phosul Utah LLC. The
investment gives FIR significant influence but not control; it is therefore accounted for using the
equity method.
18.
Loans
Company - current
2024
£‘000
2023
£‘000
Balance at beginning of year
2,781
3,686
Net funds advanced to subsidiaries
33
195
Impairment of loans
-
(1,100)
Balance at 31 December
2,814
2,781
All loans to subsidiaries are currently unsecured and interest free and repayable on demand.
19.
Inventories
2024
£’000
2023
£’000
Phosphate, including processed material
held for sale
532
621
KERAS RESOURCES PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 54
532
621
20.
Trade and other receivables
Group
2024
£‘000
2023
£‘000
Trade receivables
237
91
Other receivables
74
71
Prepayments
8
9
319
171
Company
2024
£‘000
2023
£‘000
Trade receivables
Other receivables
251
2
95
-
Prepayments
8
7
261
102
Other receivables are stated at their nominal value less allowances for non-recoverability.
The Group and Company’s exposure to credit and currency risk is disclosed in note 28. Trade
receivables are net of a provision for bad debts of £nil (2023: £nil). No bad debt expense has been
recognised in the current or prior years.
21.
Discontinued operations
Through its 100% owned, Guernsey incorporated subsidiary, Southern Iron Ltd, Keras held an 85%
interest in Société Générale des Mines SA (“SGM”) which holds research permits for the Nayéga
manganese project in northern Togo (“Nayéga”). The research permits are effectively the
equivalent of a mining exploration licences and cover a 19,903 ha area in northern Togo.
During the previous year, Keras sold all the Group’s intellectual property relating to Nayéga,
comprising reports, feasibility studies etc, to a newly formed mining company set up by the Republic
of Togo, for cash consideration of $1.7m, generating a profit on disposal of follows:
2023
£‘000
Proceeds ($1.7m)
1,339
Less: Commission
(132)
Less: Carrying value of assets held for sale
(1,086)
121
Subsequent to the sale of intellectual property, on 29 December 2023, the group disposed of all
its 85% shareholding in Société Générale des Mines for a cash proceeds of £1. Accordingly, non-
controlling interests and cumulative translation reserves related to subsidiary were derecognised
on disposal.
2023
£‘000
Proceeds (£1)
-
Net assets at disposal
-
Non-controlling interest at disposal
(117)
Cumulative translation reserve
41
Loss on disposal of subsidiary
(76)
KERAS RESOURCES PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 55
22.
Retirement benefit schemes
Defined contribution schemes
2024
£‘000
2023
£‘000
Charge to profit or loss in respect of defined contribution schemes
-
2
The Group operates a defined contribution pension scheme for all qualifying employees. The assets
of the scheme are held separately from those of the Group in an independently administered fund.
At the year end, an amount of £1,919 (2023 - £1,919) was held in trade and other payables in
respect of accrued unpaid pension contributions.
23.
Capital and reserves
Share capital
All ordinary shares rank equally with regard to the Company’s residual assets. The holders of ordinary
shares are entitled to receive dividends as declared from time to time, and are entitled to one vote
per share at general meetings of the Company.
Issues of ordinary shares
On 06 July 2024 400,000 ordinary shares of 1p each were issued at 3.75p per share to settle a payable
of £15,000.
On 29 October 2024 14,900,000 ordinary shares of 1p each were issued via subscription at 2.5p per
share to raise working capital.
Subsequent to the year end, on 7 April 2025, 1,278,515 ordinary shares were issued at 1.4681 pence per
share to settle payables of £19k, 1,816,836 ordinary shares were issued at the same rate to R Lamming
to settle outstanding fees of £27k and 523,383 ordinary shares were issued at the same rate to B Moritz
in respect of Company liabilities settled personally by him of £7,728.
Warrants
2024
2023
Average
exercise price
Number
Average
exercise price
Number
In issue at beginning of year
18p
16,775,000
18p
16,775,000
Lapsed
18p
(16,775,000)
18p
-
In issue at 31 December
18p
-
18p
16,775,000
On 16 April 2022 1,000,000,000 warrants were agreed to be issued to subscribers for the Ordinary Shares
agreed to be issued for cash on 16 April 2022 on the basis of 1 warrant for every 2 shares subscribed.
The warrants are exercisable at price of 0.18p at any time up to 31 May 2024.
Number of ordinary shares
In issue at beginning of year
Issued to settle payables/for cash
2024
Shares of 1p each
80,097,177
15,300,000
2023
Shares of 1p each
79,735,731
361,446
In issue at 31 December - fully paid
95,397,177
80,097,177
KERAS RESOURCES PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 56
23. Capital and reserves (continued)
On 18 May 2022 677,500,000 warrants were agreed to be issued to subscribers for the Ordinary Shares
agreed to be issued for cash on 18 May 2022 on the basis of 1 warrant for every 2 shares subscribed.
The warrants are exercisable at price of 0.18p at any time up to 31 May 2024.
The issues set out above were amended following the 1 for 100 consolidation of the Company’s
ordinary shares.
No warrants remained outstanding at 31 December 2024.
Other reserves
Share option/warrant reserve
The share option/warrant reserve comprises the cumulative entries made to the consolidated
statement of comprehensive income in respect of equity-settled share-based payments as adjusted
for share options cancelled.
Exchange reserve
The exchange reserve comprises all foreign currency differences arising from the translation of the
financial statements of foreign operations.
Convertible loan note reserve
The convertible loan reserve comprises the part of the Convertible Loan Notes in issue at 31 December
2024, which is calculated to be equity, as set out in Note 27.
24.
Earnings per share
Basic and diluted earnings/(loss) per share
The calculation of basic earnings/(loss) per share at 31 December 2024 is based on the following
(loss)/profit attributable to ordinary shareholders and a weighted average number of ordinary
shares in issue.
Loss attributable to ordinary shareholders (£)
2024
2023
Continuing operations
(737,000)
(720,000)
Discontinued operations
-
29,000
Loss attributable to ordinary shareholders
(737,000)
(691,000)
Basic weighted average number of ordinary shares
2024
2023
Issued ordinary shares at beginning of year
80,097,177
73,768,128
Effect of shares issued
2,936,712
6,143,869
Weighted average number of ordinary shares
83,033,889
79,911,997
Diluted weighted average number of shares
2023
Basic weighted average number
79,911,997
Effect of share options in issue
1,245,174
Effect of warrants in issue
15,980,395
Weighted average number of ordinary shares
97,137,566
KERAS RESOURCES PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 57
24. Earnings per share (continued)
In the year ended 31 December 2024 the dilutive effect of outstanding warrants and share options is
not material.
As a result of the group being loss making the earning per share is presented on a basic weighted
average number of shares basis and not diluted.
25. Share-based payments
Number of share options
Average exercise price
2024
2023
2024
2023
Pence
Pence
Outstanding at 1 January 2024
1,300,000
1,300,000
16
16
Issued in year
600,000
Forfeited in the year
-
-
16
16
Outstanding at 31 December 2024
1,900,000
1,300,000
16
16
Exercisable at 31 December 2024
1,900,000
1,266,667
16
16
The Company established an Enterprise Management Incentive Scheme to incentivise Directors and
senior executives. On 17 January 2020, 1,200,000 options were granted at £0.1639 with 100,000 vesting
immediately, 300,000 vesting on 9 March 2020, 300,000 vesting on 17 January 2021, 300,000 vesting on
17 January 2022 and 200,000 vesting on 17 January 2023. The options lapse if not exercised within 5
years. Of the total, 900,000 options were granted to R Lamming, a Director.
The Black Scholes pricing model was used to calculate the share based payment charge incorporating
an annual volatility rate of 55%, expected life of between 2 and 5 years and risk free investment rate of
between 0.23% and 0.39%. The charge for the year ended 31 December 2024 for these rights which was
included in administrative and exploration expenses amounted to £nil (2023 – £186).
On 7 April 2021, 100,000 options were granted at £0.1183 with 33,333 vesting on 1 April 2022, 33,333
vesting on 1 April 2023 and 33,334 vesting on 1 April 2024. The options lapse if not exercised within 5
years. The Black Scholes pricing model was used to calculate the share based payment charge
incorporating an annual volatility rate of 57%, expected life of between 4 and 6 years and risk free
investment rate of between 0.6% and 0.93%. The charge for the year ended 31 December 2024 for these
rights which was included in administrative and exploration expenses amounted to £339 (2023 - £1,841).
On 23 February 2024, 600,000 options were granted with 200,000 granted at 4p vesting on 21 February
2025, 200,000 granted at 5p vesting on 21 February 2026 and 200,000 granted at 6p vesting on 21
February 2027. The options lapse if not exercised within 3 years. The Black Scholes pricing model was
used to calculate the share based payment charge incorporating an annual volatility rate of 53%,
expected life of between 4 and 6 years and risk free investment rate of between 3.88% and 3.9%. The
charge for the year ended 31 December 2024 for these rights which was included in administrative and
exploration expenses amounted to £11,017 (2023 - £nil).
KERAS RESOURCES PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 58
26.
Trade and other payables
Group - Current
2024
£‘000
2023
£‘000
Trade payables
404
238
Accrued expenses
118
176
Other payables
44
6
Deferred consideration to previous minority
shareholder in subsidiary company
639
593
1,205
1,013
Group – Non-Current
2024
£‘000
2023
£‘000
Deferred consideration to previous minority
shareholder in subsidiary company
-
531
Promissory notes repayable 2028 (see Note 27)
1,997
-
1,997
531
Company - Current
2024
£‘000
2023
£‘000
Trade payables
98
43
Accrued expenses
76
176
Other payables
30
6
Deferred consideration to previous minority
shareholder in subsidiary company
639
593
843
818
Company – Non-Current
2024
£‘000
2023
£‘000
Deferred consideration and loans to previous
minority shareholders
-
531
Convertible loan notes repayable 2028 (see note 27)
813
-
813
531
There is no material difference between the fair value of trade and other payables and accruals and
their book value. The Group’s and Company’s exposure to currency and liquidity risk related to trade
and other payables is disclosed in Note 28.
Deferred consideration and loans to previous minority shareholders relates to the acquisition of the
outstanding 49% equity interest in Falcon Isle and loans totalling $1,816,527 made by the vendor to
Falcon Isle, for total consideration of $3.2 million, payable in four annual tranches of $800,000
commencing on 1 July 2022 and as such the deferred consideration and loans to previous minority
shareholders has been discounted at 12%. During the prior year, unwinding of £156,000 was
recognised as a finance cost in the statement of profit or loss.
KERAS RESOURCES PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 59
27.
Loans and borrowings
Group – Non-Current
2024
£‘000
2023
£‘000
Promissory notes, repayable 2028
$350,000 7% secured notes
i
280
-
$762,500 8% unsecured notes
ii
609
-
Interest free loan repayable 2029
295
-
Convertible loan notes, repayable 2028
£300,000 7% notes
iii
281
-
£597,500 4% notes
iv
501
-
Rolled up interest
31
1,997
-
Company – Non-Current
2024
£‘000
2023
£‘000
Convertible loan notes, repayable 2028
£300,000 7% notes
iii
281
-
£597,500 4% notes
iv
501
-
Rolled up interest
31
-
813
-
i.
On 22 January 2024, a secured 4-year promissory note of $350,000 was issued by Falcon Isle. The
note carries 7% interest and is repayable after 4 years. Falcon Isle has the right to repay it, without
penalty, after 2 years. Interest is payable annually.
ii.
On 28 May 2024, unsecured 4-year promissory notes totalling US$762,500 were issued by Falcon Isle.
The notes carry 8% interest and are repayable after 4 years. Falcon Isle has the right to repay them,
without penalty, after 2 years. Interest is payable annually.
iii.
On 22 January 2024, a 4-year convertible loan of £300,000 was issued by the Company. It carries
interest at 7% per annum and is convertible into ordinary shares of £0.01p at a conversion price of
£0.04 per share. The loan note may be converted at any time by notice given by the holder, interest
will be rolled up and included with the amount being converted or paid at the end of the 4-year
loan period if not converted. The equity portion of the loan is computed as £19,439 using market
interest rate of 9.0%, recorded within statement of changes in equity. Notwithstanding this, if not
converted the loan note is repayable at its nominal value of £300,000 if not converted.
iv.
On 28 May 2024, 4-year convertible loan notes totalling £597,805 were issued by the Company. They
carry interest at 4% per annum and are convertible into ordinary shares of £0.01p at a conversation
price of £0.0275 per share. The loan notes may be converted at any time by notice given by the
holders; interest will be compounded annually and included with the amount being converted or
paid at the end of the 4-year loan period if not converted. The equity portion of the loan is
computed as £96,836 using market interest rate of 9.0%, recorded within statement of changes in
equity. Notwithstanding this, if not converted the loan note is repayable at its nominal value of
£597,805 if not converted.
KERAS RESOURCES PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 60
28.
Financial instruments
Financial risk management
The Group’s operations expose it to a variety of financial risks that include liquidity risk. The Group
has in place a risk management programme that seeks to limit the adverse effect of such risks on its
financial performance.
Credit risk
Credit risk is the risk of financial loss to the Group if a customer or counterparty to a financial
instrument fails to meet its contractual obligations.
Exposure to credit risk
The carrying amount of financial assets represents the maximum credit exposure. The maximum
exposure to credit risk at the reporting date was as follows.
Group
Financial assets at amortised
cost
Carrying amount
Credit risk
2024
£‘000
2023
£‘000
Trade and other receivables
319
171
Cash and cash equivalents
249
185
568
356
Expected credit loss assessment
Balance
Expected
loss rate %
Loss
allowance
Trade receivables
£’000
£’000
Current
171
-
-
1-30 days overdue
55
-
-
31-60 days overdue
44
-
-
61-90 days overdue
47
-
-
Over 90 days overdue
15
-
-
332
-
The director considers that the carrying amount of trade and other receivables is approximately
equal to their fair value.
Liquidity risk
Liquidity risk is the risk that the Group will encounter difficulty in meeting the obligations associated
with its financial liabilities that are settled by delivering cash or another financial asset.
The Group reviews its facilities regularly to ensure it has adequate funds for operations and expansion
plans.
The following are the contractual maturities of financial liabilities, including estimated interest
payments and excluding the impact of netting agreements.
KERAS RESOURCES PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 61
28.
Financial instruments (continued)
Group
2024
Carrying
amount
£’000
Contractual
cash flows
£’000
3 months
or less
£‘000
3-12
months
£‘000
2-5 years
£’000
Non-derivative financial assets
Inventory
532
532
532
-
-
Trade and other
receivables
319
319
319
-
-
Cash and cash
equivalents
249
249
249
-
-
1,100
1,100
1,100
-
-
Non-derivative financial liabilities
Trade and other payables
3,202
3,478
873
1,302
1,302
3,202
3,478
873
1,302
1,302
Liquidity gap
(2,102)
(2,378)
227
(1,302)
(1,302)
Group
2023
Carrying
amount
£’000
Contractual
cash flows
£’000
2 months
or less
£‘000
2-12
months
£‘000
2-5
years
£’000
Non-derivative financial assets
Inventory
621
621
621
-
-
Trade and other
receivables
163
163
163
-
-
Cash and cash
equivalents
185
185
185
-
-
969
969
969
-
-
Non-derivative financial liabilities
Trade and other payables
1,544
1,677
421
628
628
1,544
1,677
421
628
628
Liquidity gap
(575)
(708)
548
(628)
(628)
Market risk
Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates
and equity prices will affect the Group’s income or the value of its holdings of financial instruments.
The objective of market risk management is to manage and control market risk exposures within
acceptable parameters, while optimising the return.
KERAS RESOURCES PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 62
28.
Financial instruments (continued)
Currency risk
The Group is exposed to foreign currency risk on purchases that are denominated in currencies
other than GBP. The currencies giving rise to this risk are primarily the US dollar.
The carrying amounts of the group's foreign currency denominated monetary assets and liabilities
at the reporting date are as follows:
GBP
£’000
USD
£’000
Cash and cash equivalents
68
181
Trade and other receivables
10
309
Trade and other payables
(599)
(606)
Loans
(813)
(1,184)
(1,334)
(1,300)
Fair values
The fair values of financial instruments such as trade and other receivables/payables are
substantially equivalent to carrying amounts reflected in the balance sheet.
Capital management
The Group’s objective when managing capital is to safeguard its accumulated capital in order to
provide an adequate return to shareholders by maintaining a sufficient level of funds, in order to
support continued operations.
The Group considers its capital to be total shareholders’ equity which at 31 December 2024 for the
Group totalled £2,951,000 (2023: £3,183,000) and for the Company totalled £4,247,000 (2023:
£4,201,000).
29.
Related parties
The Group’s related parties include its key management personnel and others as described below.
With the exception of $650,000, all the subscriptions for Promissory Notes ($1,012,500) and Convertible
Loan Notes (£897,805) as set out in Note 27 were made by related parties. Each of Russell Lamming
and Graham Stacey, directors of the Company, subscribed $100,000, divided equally between
Unsecured Promissory Notes and 4% Convertible Loan Notes. The balance was subscribed by
Christopher Grosso, a substantial Shareholder, and the Diane H. Grosso Credit Shelter Trust, an
associated party of Christopher Grosso.
With the exception of $350.000 secured promissory notes no guarantees have been given or
received Subject to the exercise of the conversion rights attached to the Convertible Loan Notes
all outstanding balances are expected to be settled in cash.
Briam Moritz personally settled £7,728 of liabilities of the Company. This amount was owed to him at
31 December 2024, and was capitalised subsequently as set out in Note 23.
KERAS RESOURCES PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 63
29.
2023
£’000
11
2,769
30.
Related parties (continued)
Other related party transactions
Transactions with Group companies
The Company had the following related party balances from financing activities:
2024
£’000
Southern Iron Limited
- Loans and receivables (interest free)
20
Falcon Isle Resources LLC
- Loans and receivables (interest free)
2,794
Subsequent events
On 7 April 2025 new Ordinary Shares were issued as set out in note 24 above.
On 25 June 2025 the Company issued zero coupon convertible loan notes for £750,000.