Mineral & Financial Investments
Annual Report 2023

Plain-text annual report

Mineral & Financial Investments Limited Annual Report and Financial Statements for the year ended 30 June 2023 Mineral & Financial Investments Limited (“M&FI”) is an investing company with the objectives of a mining finance house, which includes providing investment in and capital to finance mining companies and/or projects to provide our shareholders with superior returns. We will seek to provide financing and act as a good partner in exchange for meaningful ownership levels, and board representation if needed and appropriate. We will provide advisory services when possible and will be willing to make follow-on investments in the investee companies if, and when, appropriate. Since June 30, 2016, has succeeded in increasing its Net Asset Value at a Compound Annual Growth Rate (“CAGR”) of 36.9% per year. Net Asset Value Per Share has grown at a CAGR of 26.5% per year for the past 5 years. M&FI NAVPS vs. Comparables Indexed Performance (Fig. 1) 7.00 6.00 5.00 4.00 3.00 2.00 1.00 - June 30, 2017 June 30, 2018 June 30, 2019 June 30, 2020 June 30, 2021 June 30, 2022 June 30, 2023 MAFL NAV INDEX (Dec 31, 2016) RHS MAFL NAVPS Index (Dec 31, 2016) LHS Baker Steel Resource Trust NAV Index (Dec 31, 2016) LHS FTSE 350 Mining Index (Dec 31/2016) LHS Goldman Sachs Commodity Index (Dec 31 2016) LHS Full Year Highlights for the year ended 30 June 2023  Fiscal Year-end Net Asset Value £ 9.4M (FYE: 30/6/23) up 26.5%, from £7.5M (FYE: 30/6/22)  Net Asset Value Per Share (“NAVPS”) FD 24.27p, up 21.1%, from 20.04p (FYE: 30/6/22)  Net Asset Value has increased at Compound Annual Growth Rate of 29.1% since 30 June 2018  Investment Portfolio now totals £9.1m, up 18.7%, Year/Year from £7.7M (FY: 30/6/22).  NAVPS growth has exceeded that of the FTSE 350 Mining index and of the S&P GSCI since 2017 NET ASSET VALUE 30 June 2018 30 June 2019 30 June 2020 June 30 2021 June 30 2022 June 30 2023 CAGR (%) Net Asset Value (‘000) £2,623 £5,114 £5,474 £6,438 £7,454 £9,423 29.1% Fully diluted NAV per share 7.49p 14.50p 15.50p 18.22p 20.04p 24.27p 26.5% PORTFOLIO PERFORMANCE (FISCAL YEAR END) 2018  2023 (£,000) 2018 2019 2020 2021 2022 2023 2023 vs. 2022 CAGR ‘2018 to 2023 Strategic £767 £3,655 £3,910 £4,110 £4,947 £6,721 35.9% 44.3% Tactical £1,319 £226 £430 £1,712 £2,237 £2,204 -1.5% 14.4% Cash Total £422 £225 £275 £855 £481 £796 65.3% 19.5% £2,508 £4,106 £4,615 £6,677 £7,665 £9,721 26.8% 30.1% The full details of our investing policy are set out in the Directors’ Report 1 Mineral & Financial Investments Limited CONTENTS REPORTS1 Company Information Chairman’s Statement Chief Executive’s Report Strategic Report Directors' Report Corporate Governance Report Report on Remuneration Independent Auditor’s Report FINANCIAL STATEMENTS Consolidated Income Statement and Consolidated Statement of Comprehensive Income Consolidated Statement of Financial Position Consolidated Statement of Changes in Equity Consolidated Statement of Cash Flows Notes to the Financial Statements page 2 3 6 14 16 18 23 25 30 31 32 33 34 1 No comment or fact stated in these reports should be taken or interpreted as investment advice. 2 Mineral & Financial Investments Limited COMPANY INFORMATION DIRECTORS: REGISTERED OFFICE: COMPANY NUMBER: SECRETARY: NOMINATED ADVISER: JOINT BROKERS: REGISTRARS: SOLICITORS: AUDITORS: Mark T Brown, Chairman C.C. Jacques Vaillancourt, President & CEO James E. Lesser Sean T. Keenan One Nexus Way Camana Bay Grand Cayman KY1-9005 Cayman Islands Incorporated in the Cayman Islands with registered number 141920 Intertrust SPV (Cayman) Limited W H Ireland 24 Martin Lane London EC4R 0DR UK W H Ireland 24 Martin Lane London EC4R 0DR UK Novum Securities Ltd. 10 Grosvenor Gardens London SW1W 0DH UK Link Market Services (Jersey) Limited PO Box 532 St Helier Jersey JE4 5UW Charles Russell Speechlys 5 Fleet Place London EC4M 7RD Shipleys LLP Registered Auditor Chartered Accountants 10 Orange Street London WC2H 7DQ COMPANY’S WEBSITE: www.mineralandfinancial.com 3 Mineral & Financial Investments Limited CHAIRMAN’S STATEMENT for the year ended 30 June 2023 Dear fellow shareholders, Mineral & Financial Investments Limited (“M&FI”) is an investing company that approaches its business as a mining finance house, which includes providing investment in and capital to finance mining and mineral exploration companies, and/or projects, while aiming to provide our M&FI shareholders with superior returns. We will seek to provide financing and act as a good partner in exchange for meaningful ownership levels, and board representation if needed and appropriate. We will provide advisory services when possible and will be willing to make follow-on investments in the investee companies if, and when, appropriate. The full details of our investing policy are set out in the Directors’ Report. During the 12-month fiscal period ending 30 June 2023 your company generated Gross Income of £2.394 million which translated into an Operating Profit of £1.806 million. Net Profit for the full year was £1.550 million or 4.35p per share basic or 4.03p per share on a Fully Diluted (“FD”) basis for the period. At the year-end of 30 June 2023, our Net Asset Value (NAV) was £9.423M an increase of 26.4% from the 30 June 2022 NAV of £7.454M. The NAV per share – fully diluted (NAVPS-FD) as of 30 June 2023 was 24.27p, up 21.1% from the 30 June 2022 was 20.04p. Since 30 June 2018, our NAV FD has appreciated on average by 26.5% annually. We continue to be effectively debt free, with working capital of £9.542M. ASSET VALUE GROWTH - 2016 to 2023 (Fig. 2) £10,000,000 £8,000,000 £6,000,000 £4,000,000 £2,000,000 £0 June 30, 2016 June 30, 2017 June 30, 2018 June 30, 2019 June 30, 2020 June 30, 2021 June 30, 2022 June 30, 2023 Cash Investments £137,688 £960,568 £917,554 £422,307 £1,601,913 £2,269,321 £224,384 4,951,859 £274,646 £854,729 £481,401 £795,560 £5,315,307 £5,822,262 £7,183,538 £8,924,806 Investments Cash In a series of challenging years for the metals and mining sector, we believe 2023 has been the most challenging year since 2013. The industry has experienced slowing total World output (Fig. 3) from a COVID recovery high of 6% in 2021 to an estimated 3% in 2023. In 2022 total World Consumer Prices (Fig. 3) peaked at an 8.7% increase for the full year 2022. We believe cost inflation coupled with rising interest rates, mediocre metal price performance and “peak apathy” for the sector by investment markets has created a brutal environment for the sector and general investment performance. The FTSE 350 Mining Index was up 5.2% Yr/Yr. for the period ending June 30, 2023 (Fig.6). As we write this statement the month over month performance has been down for the major equity markets indices we follow, but the FTSE 350 Mining Index was up 3.9% in October 2023 over September 2023. We consider this might be a turning point. The Directors noted that US 10-year Treasuries rose 27.2% during the Company’s fiscal year, ending 30 June 2023 to 3.84%, and today stand at 4.86%. US treasuries, which we believe is the reference point for most interest rate markets, have guided global rates upwards. We also have observed the Western Central Banks, to mitigate inflationary pressures, have increased their rates up along with the US Federal Reserve. We believe a secondary objective, of the central banks is a return to more historically consistent levels of treasury yields ending the prolonged period of depressed interest rates. The Directors note that according to Yale University’s Professor Schiller, long term Interest Rates, although volatile over time, have averaged 4.49% 4 Mineral & Financial Investments Limited CHAIRMAN’S STATEMENT for the year ended 30 June 2023 IMF – WORLD ECONOMIC OUTLOOK2 (Fig. 3) October 2023 World Output World Output - Advanced Economies Emerging Markets and Developing Economies World Consumer Prices Consumer Prices - Advanced Economies Emerging Markets and Developing Economies 2018 3.6% 2.3% 4.5% 3.6% 2.0% 4.9% 2019 2.8% 1.7% 3.7% 3.5% 1.4% 5.1% 2020 -3.1% -4.5% -2.1% 3.2% 0.7% 5.1% 2021 2022 2023(e) 2024(f) 6.0% 5.2% 6.6% 4.7% 3.1% 5.9% 3.5% 2.6% 4.1% 8.7% 7.3% 9.8% 3.0% 1.5% 4.0% 6.9% 4.6% 8.5% 2.9% 1.4% 4.0% 5.8% 3.0% 7.8% The regular readers of our Annual Report to shareholders will note that we regularly refer to the International Monetary Fund (“IMF”) bi-annual economic forecasts as a yardstick for global economic performance. Additionally, we include the IMF’s economic forecast which we believe provide a sense of what the best-informed consensus estimates are for near term economic performance. The IMF is forecasting slowing economic performance from the so-called “Advanced Economies” while forecasting that “Emerging and Developing” economies should continue to generate constant growth through 2024. In the last several annual reports, we have included the Shiller S&P 500 Cyclically Adjusted Price Earning (CAPE) chart to underscore relatively high P/E valuation of the S&P 500. The CAPE remains high at 30.8x. The average CAPE since 1871 is x17.4, while the average long term interest rate since 1871 has been 4.49%. The last long term interest rate observation by Schiller in his chart is 4.09%. The chart (Fig.4) shows that the S&P 500 is significantly above its long-term averages. We believe that this broad conclusion extends to most major equity markets. Nevertheless, we do not anticipate a dramatic market correction, but believe a gradual valuation erosion is the likeliest path as inflation buoys nominal earnings but masks the slowing of “real” earnings growth. Shiller S&P 500 P/E Index3 & Long-Term Interest Rates (Fig 4) 1981 2000 1929 1901 1966 27.4x ) 0 1 E / P , E P A C ( o i t a R s g n n r a E - e c i r P i 50 45 40 35 30 25 20 15 10 5 CAPE Long-Term Interest Rates 0 1860 1921 1880 1900 1920 1940 1960 1980 2000 2020 18 16 14 12 10 8 6 4 2 ) % ( s e t a R t s e r e t n I m r e T - g n o L 0 2040 The US dollar, as measured by the DXY Index, which is a trade weighted index of the US dollar (composed of USD vs six foreign currencies), was up 6.0% during our fiscal year, appreciating currencies in that index. This rise exceeds the DXY’s 2 International Monetary Fund, “World Economic Outlook: Recovery – Navigating Global Divergences” - October, 2023 3 Shiller P/E ratio for the S&P 500.Price earnings ratio is based on average inflation-adjusted earnings from the previous 10 years, known as the Cyclically Adjusted PE Ratio (CAPE Ratio), Shiller PE Ratio, or PE 10 5 Mineral & Financial Investments Limited CHAIRMAN’S STATEMENT for the year ended 30 June 2023 compounded growth rate of 3.2% (fig. 5) since 2018 –we believe that a mean reversion will occur at some point should aid the US dollar pricing commodities. The US Equity market valuation, as measured by the S&P 500 P/E Index, peaked this cycle at 4,766 in December 2022. Our June 30 fiscal period saw the S&P 500 open at 3785, peak at 4,766, but end on 30 June 2023 at 4,450, resulting in a 17.6% yr./yr. gain. The composite measure for the European big cap stocks, the Euro Stoxx 50, appreciated by 27.3% in the period ending 30 June 2023. The Shanghai and Hong Kong equity market indices were down 14.3% and 13.5%, respectively. The Hang Seng (Hong Kong) index today is at 17,101, down 24.6% from its 27 January 2023 peak of 22,701 – Technically it is now in a “bear” market, while the Shanghai exchange is down 16.3% from its January 2023, approaching bear market territory. Global Stock Index performance (Fig.5) Shanghai Shenzhen CSI 300 Standard & Poor 500 Euro Stoxx 50 Hang Seng FTSE 100 Nikkei 225 Source: Bloomberg LLP 30/6/2023 3842 4450 4399 18916 7532 33189 30/06/2022 4485 3785 3455 21870 7169 26393 % Ch. -14.3% 17.6% 27.3% -13.5% 5.1% 25.7% M&FI continues to seek suitable strategic investment opportunities that we believe will generate above average returns while adhering to our standards of prudence while seeking above average investment returns. We thank you for your support and we will continue to work diligently and thoroughly to advance your company’s assets and market position. Mark T. Brown Non-Executive Chairman 19 December 2023 6 Mineral & Financial Investments Limited CHIEF EXECUTIVE OFFICER’S REPORT for the year ended 30 June 2023 The Company generated gross income of £2.394M during the year, an 84.5% improvement from the previous year’s gross profit of £1.297M. The operating profit for the full year, ending 30 June 2023, improved by 135.7% to £1.806M versus last year’s operating profit of £766,000. The rise in profits is mainly due to the improved valuation of Redcorp. Previously we used historical cost accounting to value the investment, but since the publication of the feasibility study in July 2023 it was resolved that the value of the investment should be based on the estimated discounted cash flows from the Feasibility Study of the project, applying an annual discount rate of 20%. This has resulted in a £624,000 uplift in its carried value. The improvement in M&F’s profits is principally linked to our investment portfolio performance and administrative costs that rose by 10.6%, less that the rise in M&F’s investment performance. Per share earnings were 4.35p (basic) or 4.03p (FD), up 71% from 2.55p (basic) and 2.35p (FD) for the 2022 fiscal year. Foreign exchange rates negatively impacted our pre-tax income by £230,000. as the British Pound rose by about 5% versus the US dollar. The after-tax Net Income for the 2023 fiscal year was £1.550,000 vs. £899,000 achieved during the 2022 fiscal year. M&FI’s NAVPS (FD) increased 21.1% year over year to 24.27p. The overall cash and investment portfolios increased to £9.720M or by 26.8% on a year over year basis from £7.665M. Summary of Financial Performance (Fig.6) Net Asset Value Performance Net Asset Value (‘000) Fully diluted NAV per share 30 June 2018 £2,623 7.49p 30 June 30 June 2019 2020 £5,114 £5,474 14.50p 15.50p June 30 2021 £6,438 18.22p June 30 2022 £7,454 20.04p June 30 2023 £9,423 24.27p CAGR (%) 29.2% 26.5% The Directors believe the key to creating shareholder value for Mineral & Financial Investments is attempting to achieve positive risk adjusted investment returns while keeping operating costs low. More specifically, operating costs which grow at a slower rate than the accretion in the Net Asset Value. Our full year administrative costs totalled £588,000, an increase of 10.6% versus the previous year’s costs of £531,000. General & Administrative (“G&A”) costs were up nominally but declined as a percentage of year/year total assets (6.2% vs. 7.1%). The increase in yr./yr. costs were principally associated with increased share-based payments and higher operating costs for our Swiss subsidiary M&F AG. Price Performance of Various Commodities & Indices (Fig.7) Commodity Gold (US$/oz) Silver (US$/oz) Platinum (US$/oz) Copper (US$/t) Nickel (US$/t) Aluminium (US$/t) Zinc (US$/t) Lead (US$/t) Uranium (US$/t) WTI (US$/Bbl.) Trade Weighted US$ (DXY) FTSE 350 Mining Index Global Food Price Index4 Source: Bloomberg LLP 2019 (June 30) 1,389 2020 (June 30) 1,784 2021 (June 30) 1,784 2022 (June 30) 1,809 2023 (June 30) 1,920 % Ch. 2023 vs. 2022 5.7% CAGR 2018 - 2023 8.4% 15.30 837 5,969 18.30 828 6,120 26.15 1083 9,279 19.80 881 7,901 22.76 903 8,257 12,670 13,240 18,172 23,229 19,869 1,779 2,575 1,913 1,598 2,043 1,770 2,514 2,899 2,301 2,659 3,147 1,899 2,104 2,369 2,126 54,454 71,871 70,768 108,027 124,561 60.06 96.56 20,080 100.272 40.39 96.68 17,714 97.636 75.25 92.66 22,585 107.86 105.09 9,810 70.64 102.91 10,161 129.448 144.224 136.674 (5.2%) 11.3% 0.6% (1.1%) (16.4%) (20.3%) (27.5%) 10.6% 15.3% 6.1% 6.0% 5.2% 10.4% 1.9% 8.5% 11.9% 4.3% (2.1%) 2.7% 23.0% 4.1% 3.2% (15.7%) 8.1% During our fiscal year global commodity price performances were mixed. Precious metals were up modestly, base metals were down with zinc being down 27.5%, which led to reduced mine production from several mines. We also 4 International Monetary Fund / Monthly / 2016 = 100 / Not seasonally adjusted 7 Mineral & Financial Investments Limited CHIEF EXECUTIVE OFFICER’S REPORT for the year ended 30 June 2023 believe that temporary mine closures are critical, and often needed, market reactions to return markets to more favourable supply demand balances. Lead, the standout exception amongst base metals, was up 10.6%. Oil (WTI) prices was up 6.1%, above its 5-year growth trend. Uranium surprised with the creation of several physical U3O8 investment funds, and or ETF’s and the growth in energy insecurity caused by the energy shortfalls caused by the Russian/Ukrainian conflict. We admit to not having missed the boom in the Lithium market and chose not to chase the sector. Lithium, carbonate prices peaked late in 2022 at US$82.00/kg and are now US$23.00/kg. It is our considered belief that Lithium will be an important part of energy storage as we transition away from hydrocarbon usage. However, we believed that the market was “over exuberant” for Lithium which is the 25th most abundant mineral on the planet. The US Geological Survey estimated in 2021 that there was 88M/t of Lithium, and total global Lithium consumption in 2023 was 134,000 tonnes (i.e. 0.15% of currently estimated reserves). It should be noted that current estimates are that 80% to 90% of Lithium in EV’s will be recycled. The Directors understand that a little- publicized clause in the U.S. Inflation Reduction Act (“IRA”) has had US companies scrambling to recycle electric vehicle batteries in North America, which they also believe will put the region at the forefront of a global race to undermine China's dominance of the field. The Directors also understand that IRA includes a clause that automatically qualifies EV battery materials recycled in the U.S. as American-made for subsidies, regardless of their origin. The Directors consider that, if this is correct, it is important because it could potentially qualify automakers using U.S.- recycled battery materials for EV production incentives, although there is no guarantee that this will be the case. In summary, we take the view that it is unlikely that we will experience a shortage of Lithium, however, much like oil, we consider we may run out of very cheap Lithium sometime in the future. We have been overweight in precious metals, notably gold and to a lesser extent silver as well as platinum group metals (“PGM”). We remain confident that the decision was correct, and the relative performance of precious metals to date supports this. Gold is up 5.7% yr/yr, while silver has appreciated 11.3% for the period ended June 30, 2023. However, the share performance of the underlying mining companies has been below our expectations due to cost inflation exceeding metal price appreciation. We believe that this will reverse itself and the underlying companies will outperform metal prices. It is also our considered view that when a sector has been out of favour, but its fundamentals are improving - the larger cap companies will receive the first wave of investments attention, followed by mid-caps and the small caps are last to benefit from the markets’ attention. We continue to look for that change in trend across our portfolios. Precious metals represent 39.2% of our asset allocation, down from 44.9% of our assets in 2022, however, the overall value of the investment in the sector is up 10.9% yr/yr. Base metals now represent 39.5% of our asset allocation and, as of our YE were up 35.8% to £3.844M. Food, Energy and Technology increased as a percentage of our total investable assets to 12.5% , but also on an absolute dollar amount (+12.1%), due to increased investment into food and fertilizer stocks, a graphite producer as well as a small new Strategic investment in the Environmental, Social and Governance (“ESG”) auditing as well as digitizing global project data. INVESTMENT COMMODITY CLASSES Commodity Class Investment Allocation 2023-Q4 vs. 2022-Q4 (Fig. 8) Q4-2023 (%) 8.2% Q4-2023 (£) £795,560 Cash Q4-2022 (£) £481,401 Q4-2022 (%) 6.3% FYE 2023/ 2022 % Ch 65.3% Precious Metal £3,814,916 Base Metals £3,843,664 Food, Energy, Tech & Misc. £1,212,451 Diamonds £53,775 39.2% 39.5% 12.5% 0.6% £3,441,285 £2,743,970 £926,120 £72,163 44.9% 35.8% 12.1% 0.9% Total investments £9,720,366 100.0% £7,664,939 100.0% 10.9% 40.1% 30.9% -25.5% 26.8% For the past year we have seen and experienced mining indices underperforming commodity indices. Equity markets have been afflicted with a disconnect between metal prices and the performance of the shares of the companies that explore and produce these metals. For the first time in many years, we are seeing the FTSE 350 mining index outperform average commodity prices. The market is anxious about the mediocre metal price performances and the increases in production costs, led upwards by energy costs and soon to be followed by labour costs. We also believe that inflation above Central banks’ inflation targets will be a fact of life for a few more years. The US dollar’s out- 8 Mineral & Financial Investments Limited CHIEF EXECUTIVE OFFICER’S REPORT for the year ended 30 June 2023 performance is, we believe, unlikely to continue as it did in 2023. Lastly, we continue to maintain the view that commodity prices will have to rise, or capacity will have to close, which will lead to metal price rises. Although not the most robust setting for mining companies, there is, we believe, good cause for bullishness that more broadly based metal price rises will define 2024 and that the inflationary pressures of 2022 will moderate, but nevertheless remain stubbornly higher than desirable. INVESTMENT PORTFOLIOS We have high expectations and rarely exceed those expectations. However, FYE 2023 has been challenging for the whole of the metals and mining sector. Our performance in 2023 was relatively strong, but below our expectations for the year. Our NAV rose 26.5% year over year while NAVPS rose by 21.2%. The variance was mostly due to the issuance of 1.44 million shares via a small capital raise at 21.0p (see announcement dated 24/5/2023). These results exceed the performance yardsticks by which we measure our performance as can be seen in Fig. 1. The broader equity markets rose during our fiscal year: The Euro Stoxx 50 was up strongly by 27.3%; The S&P 500 was up 17.6%, the CSI 300 (Shanghai) was down 14.3%, while the FTSE 100 did manage a gain of 5.1%. The more specific comparable measures, such as - the S&P/TSX Global Mining Index was down 11.5% during our fiscal period, while FTSE 350 Mining Index, was down 55.2% – although it must be noted that we believe the FTSE 350 Mining Index was dragged down by the Ukrainian conflict and the sanctions imposed on Russian companies, which are part of the Index. CASH As a percentage of Total Investments: 8.2% Our cash as of 30 June 2023, was £796,000 a rise of 65.3% from the £481,000 as at the end of fiscal 2022. We view Cash as an investment. In FY 2023 we received the final US$2.5M payment from Ascendant as part of their earn-in on the Lagoa Salgada project. The intention is to keep the cash somewhere between 5% and 20% of our NAV so that we may take advantage of investment opportunities quickly when they present themselves. Since 2017 our average cash holding has been around 10%. Moreover, as a rule of thumb we like to have a combined value of our cash and the Tactical portfolio to range between 25 and 60 percent depending on our market perspective. For the past 3 years we have been at 35% as of the end of 2021 and ended 2022 at 35% of NAV and as at FYE 2023 we were at 31%. At the current time we believe that our greatest performance risk is under investment to the mining sector. As the mining cycle evolves, we would like to gradually evolve to a higher cash & tactical holding as we monetise our strategic investments and marshal our cash holdings to protect our overall performance record. M&F Portfolio Performance 2017 – 2023 (Fig.9) (£,000) 2018 2019 2020 2021 2022 2023 2023 vs. 2022 CAGR ‘18 to 2023 Strategic £766.9 £3,655.3 £3,909.7 £4,110.3 £4,946.5 £6,721.3 35.9% Tactical £1,319.2 £226.3 £430.4 £1,711.9 £2,237.0 £2,203.5 -1.5% Cash Total £422.3 £224.4 £274.6 £854.7 £481.4 £795.6 65.3% £2,508.3 £4,106.0 £4,614.8 £6,677.0 £7,664.9 £9,720.4 26.8% 54.4% 10.8% 13.5% 31.1% TACTICAL HOLDINGS As a percentage of Total Investments: 22.7% The Tactical portfolios declined by 1.5% to end the year at £2.203M. We have seen a compression of public company valuations which we believe is due to higher interest rates, increased inflation, and commodity price movements largely below the rate of inflation. As we advance through the mining cycle, we believe the tactical portfolio should grow more quickly than the strategic portfolio, as we monetise some of our strategic investments and convert them into either cash or tactical investments. The tactical portfolio now comprises 22 distinct investments of our total 9 Mineral & Financial Investments Limited CHIEF EXECUTIVE OFFICER’S REPORT for the year ended 30 June 2023 portfolio of 29 investments. The following are some of the most noteworthy holdings in our Tactical Portfolio. All values are as of June 30, 2023: Agnico Eagle Mines: Equity Mkt. Cap: C$30,347M As a percentage of Total Investments: 1.8% Agnico is a Canadian Gold mining company founded by industry legend, Paul Penna, in 1957. Agnico represents 1.8% of our total investment holdings. Agnico has evolved from its original Joutel Mine in Quebec, to now being an international mining organisation ranking as the third largest, by gold production, gold mining company in the world. It owns and operates 2 of the world’s largest gold mines. We believe that Agnico is an exemplary operator and has developed a reputation of being one of the finest gold mining companies in the world. As a evidence of the success of their strategy - Agnico Eagle now has more than 50M oz of gold Proven and Probable Reserves and is guiding investors that it will produce 3.24 to 3.44 million ounces of gold in 2023. We consider its mines are well run and note that it is guiding that its total cash costs in 2023 will be US$840/oz to $890/oz and an All-In Sustaining Costs (“AISC”) is US$1,150/oz. From these operations Agnico pays an annual US$1.60 per share dividend. In addition, we note that these operations are underpinned by strong financial footings and US$1.46B of liquidity. We believe that the shares were depressed by the share acquisition of Kirkland Lake Gold, which we used as an opportunity to initiate a position. Ascendant Resources Inc.: Equity Mkt. Cap: C$22.495M As a percentage of Total Investments: 4.0% We have held our position in Ascendant for several years. The holding, despite its performance represent 4.0% of our investment portfolios; and is held by one of our subsidiaries. It was part of the payment made by Ascendant for its original acquisition of a 25% interest in Redcorp from TH Crestgate; and part of the earn-in agreement with Ascendant for the Lagoa Salgada Project located on the well-known Iberian Pyrite Belt (IPB) in South Central Portugal. The IPB is home to several of the world’s largest zinc mines and hosts the original mine that became the cornerstone of Rio Tinto Mines. We consider that Ascendant to have been a good partner and have advanced the Lagoa Salgada Project, meeting all earn-in obligations, in challenging times for junior mining companies. Ascendant has completed a Feasibility Study. The Feasibility Study indicates that the project whilst there can be no guarantee that any of these results can be achieved and acknowledging this is no-longer a core holding, we remain optimistic that this investment will outperform from the current levels. Barrick Gold Corp. Equity Mkt. Cap: US$29,729M As a percentage of Total Investments: 1.5% Barrick has been refining its business strategy since its merger with Randgold Resources. Initially the combined companies focused on increasing efficiency, disposing of non-core assets, and strengthening the balance sheet. Latterly Barrick has been diversifying into copper production and now has 3 copper mines in addition to its 13 gold mines. Barrick is one of the largest gold mining companies in the world and owns or operates 6 of the top 10 gold mines in the world. Barrick is guiding towards full year gold production of 4.2M to 4.6M oz of Gold in 2023 at total cash cost of US$953/oz of gold and an AISC of US$1,325/oz. Barrick business strategy is to build an asset base that will lead to production of 6.8M oz AuEq production (including copper, et al.) by 2029, a >60% increase from the current levels of production. At the end of the September 30, 2023, period Barrick has working capital of US$5.0B, of which US$4.3B is cash and equivalents. While Debt, Net of Cash is US$342M. Barrick’s shares carry a 3.6% dividend and trade at what we believe is a depressed valuation that has yet to recognise the improved outlook for the company. Cerrado Gold: Equity Mkt. Cap: C$83.517M As a percentage of Total Investments: 2.1% We initiated an investment in common shares of Cerrado Gold in 2019. It now represents 2.1% of our investments. Cerrado is a South American gold producer with a mine, Minera Don Nicolas (“MDN”), in Argentina, which mined 53,000 oz in 2022, slightly above the guidance the company had offered. Cerrado is guiding towards production of 60,000 to 65,000 oz of gold of production in 2023 with an ISC of US$1,200/oz. The current estimated production for 2024 is 75,000 to 90,000 ounces at an AISC of $1,100/oz of gold. There remains very significant exploration potential at MDN to expand the resource which would allow further production expansion. Additionally, Cerrado has the Monte 10 Mineral & Financial Investments Limited CHIEF EXECUTIVE OFFICER’S REPORT for the year ended 30 June 2023 do Carmo (“MDC”) exploration project in Brazil. Cerrado has just announced a preliminary maiden Measured and Indicated resource at MDC’s Serra Alta zone, within MDC, of 1.012M oz at a grade of 1.95/g/t. There remain at least 10 other exploration targets in addition to Serra Alta which could push the resource higher. Newmont Corporation: Equity Mkt. Cap: U$49,075M As a percentage of Total Investments: 1.6% Denver based Newmont was added to our portfolio in part via the acquisition by Newmont for shares of Newcrest Mining investment. After the Newcrest acquisition, Newmont is the largest gold producer in the world and claims that its portfolio of assets includes half of the world’s “Tier One”5 mines. Post-merger share exchange we decided to retain our position on the basis that we believe Newmont can extract synergies totalling US$500M from the assets. Newmont is a well-run company that is outstanding at implementing merger efficiencies. The company is guiding towards full year 2023 Au production of 5.3M/oz. As of the third quarter of 2023 Newmont had Cash and Equivalents of US$3.2B and an adjusted Net Debt to Adjusted EBITDA of 0.7x. It does have higher AISC costs (US$1,400/oz of gold) than its top 5 peer gold mining companies. The investment advantage to the higher AISC costs is that the leverage to any movement in commodity prices is greater, which coupled with Newmont’s financial strength and scale makes it a financially robust investment vehicle. The shares are down from 53.8% from their peak share price in 2022. Sibanye – Stillwater: Equity Mkt. Cap: U$4,613M As a percentage of Total Investments: 1.3% Sibanye-Stillwater is a multinational mining and metals processing group with a diverse portfolio of projects and investments across five continents. The Group is also one of the foremost global recyclers of PGM auto-catalysts and has controlling interests in leading mine tailings retreatment operations. Sibanye-Stillwater has established itself as one of the world’s largest primary producers of platinum, palladium, and rhodium and is a top-tier gold producer. It also produces and refines iridium and ruthenium, nickel, chrome, copper, and cobalt. The Group has recently begun to build and diversify its asset portfolio into battery metals mining and processing and is increasing its presence in the circular economy by growing and diversifying its recycling and tailings reprocessing operations globally. Our investment in Sibanye has yet to bear fruits, however it is a company that is reinventing itself as a producer of multiple critical metals for Electric Vehicles (EV’s) as. Part of a new green economy. It is developing the Keliber project which contains 14.5Mt of Lithium Hydroxide (Li2O), located in Europe, with a resource grade of 1.0% which should begin full commercial production in 2026. UBS Gold ETF (CHF): As a percentage of Total Investments: 1.1% Our investment in precious metal bullion is 1.2% of total investments as of 30 June 2023, down from 2.7% one year ago. We believed that we would generate better returns in precious metal shares vs. the underlying metals in 2023. We will almost always have some physical gold holdings as an “insurance policy”, the size of the holding will fluctuate as our investment outlook evolves. We maintained the core of this holding. We expect that gold will perform its historical role of providing protection against weakening currencies, economic turmoil, and armed conflicts. In the third quarter of 2023 global gold mine production (i.e. supply) was up 2% year/year and recycling were up 8% y/y, resulting in a Yr./Yr. increase in gold supply of 6%. The demand side of the equation was that demand was also up 6% in the period. Zuercher KTBK Silver ETF (CHF): As a percentage of Total Investments: 1.8% We consider that silver is occasionally, and unfairly, described as the “poor man’s” gold. Physical Silver holdings represent 2.0% of our investment holdings, down from 2.31%. The change in weighting masks the fact that we did not materially change our investment holding. Silver is a precious metal with dominant and growing industrial applications. Silver plays a critical role in the advancement of electronics. In the past century silver demand was 5 Tier 1 assets are defined as having, on average over such asset’s mine life: (1) production of over 500,000 GEO’s/year on a consolidated basis, (2) average AISC/oz in the lower half of the industry cost curve, (3) an expected mine life of over 10 years, and (4) operations in countries that are classified in the A and B rating ranges for Moody’s, S&P and Fitch. 11 Mineral & Financial Investments Limited CHIEF EXECUTIVE OFFICER’S REPORT for the year ended 30 June 2023 initially dominated by jewellery and silverware demand, then photographic and X-ray usage were its key users6. It is now a metal used primarily in various technologies that will be critical in the world’s advancement. Silver Institute, the silver producers trade association, estimates that 2023 silver production will be up 2% to 842.1M ounces (vs -1% in 2022), and recycling remained unchanged at 181.1M ounces (vs. +3% in 2022). The 2023 net total supply of silver is expected to be up 2% yr./yr. Industrial demand is expected to be up 4% in 2023, after a rise of 5% in 2022. Overall silver demand is estimated to be down 6% in 2023 after increasing by 16% in 2022. The sharp rise in 2022 demand resulted in an estimated 237.7M/oz deficit at the end of 2022, which is estimated to be a deficit of 142.1M/oz as of the end of 2023.Much like gold, we believe that for the foreseeable future a silver holding is a sensible default investment in a commodity that has strong demand fundamentals and supply which is struggling to keep pace at current prices. STRATEGIC PORTFOLIO As a percentage of Total Investments: 69.1% Our Strategic Portfolio are longer term holdings, that we strongly believe will outperform given sufficient time and capital. We believe we made these “Strategic” investments at the bottom of the cycle. These investments were in out-of-favour assets that we considered had high potential but were, we acknowledge, higher risk and less liquid. We believe our competitive advantage was that we were capable and willing to invest when others would, or could, not invest in what we believe are good geologic assets. We believe that the best return to risk ratio is to invest in good assets when these are out of favour. Our Strategic Portfolio now totals £6.097M and represents 67% of our Net Investable funds. The Strategic Portfolio was up 23.3% yr./yr. in FY 2023 and has grown by 41.9% compounded annually since 2017. The next phase of our strategy is to gradually “harvest” these investments when and where it makes sense and redeploy these funds into more liquid investments that are out of favour but have strong long term investment merits. The following are some of the most noteworthy holdings in our Strategic Portfolio. All values are as of June 30, 2023 Digbee Limited: As a percentage of Total Investments: 1.6% In fiscal 2023 we added a strategic investment by making a small, but important investment in Digbee Ltd. Digbee is the only ESG disclosure, ratings and communications platform designed specifically for the mining sector – developed in consultation with and endorsed by tier 1 financial organisations. It is used by mining companies around the world to annually disclose their ESG activities, obtain a credible rating and communicate their ESG efforts to all stakeholders. Shifting attitudes, the transition to sustainable economies and a growing demand for critical minerals means investors, insurers, employees, downstream customers, and society are all demanding a focus on Environmental, Social and Governance (ESG) activities. The Mining industry today is a better corporate citizen than ever in its history. The history of the mining industry has been marked by occasional act of irresponsibility towards the environment, which we all share, and its stakeholders. The industry is vastly improved and, we would argue, today is a leading and needed player in the improvement of the world’s environment. Mining companies and miners are today, with a few exceptions that need to be weeded out, exemplary shepherds of the environment. We believe that Digbee will be a good investment. But we also believe that Digbee is part of the solution and will help the industry measure its ESG performance, but also inform the market of the industry’s performance. Good ESG performance can lead to lower costs, easier access to human and financial capital. The target consumers/clients of Digbee are stakeholders at various levels of the chain of stakeholders, such as: Mining Companies; Investors & Debt Providers; Insurers; Consultants, and Communities. Ideon Technologies Inc.: As a percentage of Total Investments: 8.4% Ideon Technologies Inc. is a Canadian based company which is a world pioneer in the application of cosmic-ray muon tomography. Ideon now represents 9.0% of our investment portfolio. M&FI made its initial investment in 2019 and since then has participated in three follow-on investments. The initial equity investment was priced at C$0.37 per share. This spring a term sheet and pricing was tabled by Ideon with a Silicon Valley VC called Playground LLC with an 12 Mineral & Financial Investments Limited CHIEF EXECUTIVE OFFICER’S REPORT for the year ended 30 June 2023 exciting track record committed to investing in Ideon. Their investment was made at a higher price than our average investment cost. The revaluation to the latest financing price has resulted in an uplift to Ideon’s value in our portfolio. Ideon’s discovery platform provides x-ray-like visibility up to 1 km beneath the Earth’s surface, much like medical tomography images the interior of the body using x-rays. Using proprietary detectors, imaging systems, inversion technologies, and artificial intelligence, we map the intensity of cosmic-ray muons underground and construct detailed 3D density profiles of subsurface anomalies. Ideon’s discovery platform can identify and image anomalies such as mineral and metal deposits, air voids, caves, and other structures with density properties that contrast with the surrounding earth. The potential result is a new exploration paradigm that could result in a 90% reduction in core drilling, while increasing exploration certainty by 95% in the geological settings suited by tomography. The environmental impact from such a technological change would be meaningful. Since last year Ideon’s commercial advances have continued and now they have several of the world’s largest mining companies as revenue generating clients. Golden Sun Resources: As a percentage of Total Investments: 13.1% In 2019, MAFL participated in a round of financing of Golden Sun Resources (GSR) by acquiring convertible notes of GSR. As of the date of writing GSR represents 13.1% of the investment portfolios. The nature of our investments has evolved over the past 12 months as part of the progress GSR is making in advancing to completing its 400TPD mill. The mill required third party financing to be built. To facilitate GSR securing the financing we agreed to convert our notes. The conversion was based on the estimated value of the convertible notes at maturity. Additionally in the year GSR repurchased the NSR royalty on the BellaVista mine and locate it within a new Company called Toburn which spun out to the shareholders of GSR. Additionally, GSR’s very prospective exploration portfolio was spun out to shareholders in a company called Terrasun Resources SA. The mill is on schedule to be completed by the end of February 2024. Once completed it is reasonable to expect that the Bellavista Mine, which is GSR’s lead mining asset, located in Costa Rica will be producing >30,000 oz of gold per year. We believe GSR is evolving to become a leading and respected mining company in Costa Rica. GSR has achieved this distinctive status by exhibiting market leading environmental and social practices. We believe that GSR is progressing towards a monetization event, which we expect should occur in the 12 to 24 months. Luca Mining Inc: As a percentage of Total Investments: 16.8% We added Luca Mining to our Strategic Investment Portfolio in 2023. Luca is unique with 2 producing mines in Mexico. We initiated our investment as part of a re-capitalization of the company. Campo Morado, located in Guerrero State 320km from Mexico City. Campo Morado is Underground VMS zinc-copper-lead-gold-silver mine with flotation circuit to produce zinc, copper, and lead concentrates at 2,400 TPD. Campo Morado has several value creation opportunities at managements disposal. The first is to improve its metal recoveries by anticipating and preparing the evolving metallurgical changes which commonly occur with a VMS deposit, secondly to affect some expansionary exploration. Campo Morado’s current mine life currently around 20 years. If the resource base can be expanded, then the processing capacity could be expanded from the current capacity. The second mine, Tahuehueto, located in Durango State, is also an underground gold and silver mine with flotation circuit to produce zinc and lead concentrates. When we invested in Luca the management team was replaced with the objective of getting Tahuehueto up from the 350 TPD to 500 TPD by the end of Q2, which was achieved, and they plan to double its capacity to 1000 TPD by January 1, 2024. The Tahuehueto expansion, if completed on schedule, will bring Tahuehueto up to its long-promised production potential. It remains very highly prospective; we believe that its current 10-year mine life could be increased very significantly with some focused exploration on Tahuehueto. If management executes the plan and market conditions improve slightly, we expect that this investment has the potential to be significantly revalued upwards. The key will be a disciplined execution strategy, which we believe Luca’s management is committed to executing. 13 Mineral & Financial Investments Limited CHIEF EXECUTIVE OFFICER’S REPORT for the year ended 30 June 2023 Redcorp Empreedimentos Mineiros Lda.: As a percentage of Total Investments: 24.4% Redcorp is a Portuguese company whose main asset is 85% ownership of the Lagoa Salgada project. Our investment in Redcorp, held through our subsidiary, represents 19.2% of our investment portfolios. In 2018 our subsidiary entered into a sale and earn-in option agreement with a Canadian listed company, Ascendant Resources. Ascendant has met all its financial and operational obligations to date. We consider they have been good partners, running the exploration program for which, we are appreciative. On May 25, 2022, Ascendant increased its ownership of Redcorp to 50% by completing US$9,000,000 of exploration work on the project and making a US$1.0M payment to M&FI’s subsidiary (in accordance with the terms of the agreement between the parties). Ascendant has now earned 80% of the overall project by making a final US$2.5M payment to M&FI in June and completing a Definitive Feasibility Study post year end in July. The project has advanced from an initial resource of approximately 4.4Mt with Zinc Equivalent grade of 6.0% to a resource totalling 27.5Mt with a ≧7.5% Zinc Equivalent grade. Redcorp and Ascendant have recently announced that they have secured a mine development licence from the Portuguese government. Redcorp and Ascendant completed a Feasibility Study after our year end indicating that the Lagoa Salgada Project has, based on 100% ownership, a pre- tax NPV@8% of US$188.8.M resulting in a pre-tax IRR of 47% with a 2-year pre-tax payback based on its planned 14- year life of mine. After tax NPV@8% is US$147.1M with a 39% IRR and should generate a Life of Mine Cash Flow of US$261M. In November 2022 Ascendant Resources Inc ("Ascendant") entered into a streaming agreement to fund the completion of the feasibility study for Redcorp’s Lagoa Salgada project and for general corporate and working capital purposes. In connection with this agreement M&FI and Ascendant amended the terms of their shareholders agreement in respect of Redcorp. It was agreed that M&FI should have the right and option, but not the obligation, to exercise an option within 6 months (plus 10 business days) of the Stage Two Option Exercise Date (being the date when Ascendant has earned 80% of Redcorp and being no later than June 22, 2023) to require Ascendant to purchase all, but not less than all, of the shares in Redcorp at a defined price. The price would be an amount in US dollars, payable in cash, equal to 5% of the post-tax net present value of the Project provided in the feasibility study completed prior to the date of exercise using a 10.5% discount rate (the "Put Option"). In June 2023 M&FI and Ascendant agreed to an extension to the final delivery date of the feasibility study, pursuant to the Earn-in Option Agreement for the Lagoa Salgada project. As a result of the extension, the final delivery date of the feasibility study would be on or before 3 August 2023. In consideration for the extension, Ascendant agreed to grant M&FI 500,000 common share purchase warrants. Each Warrant is exercisable into one common share in Ascendant at any time for a period of 30 months at a price of $0.20 per share. Soon after the year end Ascendant announced the results of the feasibility study and with its completion Ascendant completed the option earn-in requirements to move its ownership of Redcorp to 80%. Terrasun Resources S.A.: As a percentage of Total Investments: 2.4% Terrasun was spun out to the shareholders of Golden Sun Resources. The intent was the separate the exploration portfolio from the metals streaming financing secured by Golden Sun Resources to build the CIL mill and processing facilities at the Bellavista Mine. Terrasun owns the largest portfolio of exploration properties in Costa Rica. It has 17 exploration permits covering 20,200 hectares. Seven of the 17 exploration licenses cover former historical producing mines. Additionally, Terrasun owns 6 exploration diamond drill rigs to conduct its own exploration activities and can develop a contract drilling business in Central America. Lasty, Terrasun owns a 500TPD continuous VAT Leaching (CVL) modular gold processing plant. When the market is more buoyant for junior exploration companies, such as Terrasun, will be attractive investments – particularly one that has such a dominant position in an underexplored jurisdiction such as Costa Rica. Jacques Vaillancourt, CFA President, CEO & Director 19 December 2023 14 Mineral & Financial Investments Limited STRATEGIC REPORT for the year ended 30 June 2023 The Directors present their Strategic Report for the Company (Mineral & Financial Investments Ltd) and its subsidiary companies, together the “Group”, for the year ended 30 June 2023. RESULTS The Group made a profit after taxation for the year ended 30 June 2023 of £1,550,000 (2022: £899,000). The Directors do not propose a dividend (2022: £nil). BUSINESS REVIEW AND FUTURE DEVELOPMENTS A review of the business in the period and of future developments is set out in the Chief Executive’s Report, which should be read as part of the Strategic Report. KEY PERFORMANCE INDICATORS The key performance indicators are set out below: COMPANY STATISTICS 30 June 2023 30 June 2022 Change % Net asset value Net asset value – fully diluted per share Closing share price Share price (discount)/premium to net asset value – fully diluted £9,423,000 £7,454,000 24.3p 18.0p (26%) 20.0p 10.0p (50%) Market capitalisation £6,643,000 £3,547,000 +26% +21% +80%  +87% PRINCIPAL RISKS AND UNCERTAINTIES The key risk facing shareholders is that the value of the investments falls and that future returns to shareholders are therefore lower than they could have been. The development and fluidity of the conflicts in Ukraine and the Middle East makes it difficult to predict its ultimate impact at this stage. However, due to the nature of the Group's activities, the impact on the Group has been minimal and most of its investee companies are looking to expand their activities. Details of the financial risk management objectives and policies are provided in Note 18 to the financial statements. PROMOTION OF THE COMPANY FOR THE BENEFIT OF THE MEMBERS AS A WHOLE While M&FI is incorporated in the Cayman Islands and therefore does not have to comply with the UK Companies Act, the Company considers the disclosures within the Annual Report to be consistent with the requirement for UK incorporated companies to include a Section 172 Statement which requires 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 Directors believe that during the year they have acted in the way most likely to promote the success of the Company for the benefit of its members as a whole and have adhered to the requirements set out above that are applicable to the Company given its scope of operations. For example, the Company does not have any employees other than the directors, so considering employee interests is not relevant. However, the Company has been focused on implementing the investment strategy previously approved by shareholders which has resulted in a significant improvement in financial performance over the last 5 years. 15 Mineral & Financial Investments Limited STRATEGIC REPORT for the year ended 30 June 2023 GOING CONCERN The Group has prepared cash forecasts to December 2024 which assume no significant investment activity is undertaken unless sufficient funding is in place to undertake the investment activity and the forecasts demonstrate that the Group is able to meet its obligations as they fall due. The Directors consider that there are no material factors which are likely to affect the ability of the Group to continue as a going concern. Accordingly, the Directors believe that as at the date of this report it is appropriate to continue to adopt the going concern basis in preparing the financial statements. For and on behalf of the Board James Lesser Director 19 December 2023 16 Mineral & Financial Investments Limited DIRECTORS’ REPORT for the year ended 30 June 2023 The Directors present their annual report together with the audited financial statements for the year ended 30 June 2023. PRINCIPAL ACTIVITY AND INVESTING POLICY During the year the Company continued to act as an investment company. The following Investing Policy was adopted at a General Meeting held 28 November 2013: “The Company’s Investing Policy is to invest in the natural resources sector through investments in companies or other assets, which it considers to represent good value and offer scope for significant returns to Shareholders over the long term. In particular, the Company will focus on providing new capital for mining companies that require finance for their projects. Investments will be made in the securities of quoted and unquoted companies and their assets, units in open-ended investment companies, exchange traded funds, physical commodities, derivatives, and other hybrid securities. As the Company’s assets grow the intention is to diversify company, geographic, and commodity risks. The Company will have a blend of passive and active investments and, if and when appropriate, it may seek to gain control of an investee company. Returns to shareholders are expected to be by way of growth in the value of the Company’s Ordinary Shares. The Company may also from time to time make market purchases to buy in the Company’s Ordinary Shares if the Directors consider this to be in the interests of shareholders. The Company will publish a quarterly update on its Net Asset Value (“NAV”). Mineral & Financial Investments Ltd.’s investment policy is focused on the metals and mining industry. The Company’s strategy is to invest, finance, and advise metals and mining companies through “Strategic” investments. The Company’s capital, when not deployed in strategic investments, will be captured, and deployed in its “Tactical” portfolio. CHARITABLE AND POLITICAL DONATIONS No charitable or political donations were made during the year (2022: £Nil) POST YEAR END EVENTS On 26 July 2023 the Company announced that Ascendant had completed the feasibility study for the Lagoa Salgada project and thus had completed its earn-in to 80% of Redcorp. DIRECTORS The Directors of the Company during the year and subsequently are set out below. Mark T Brown Jacques Vaillancourt James Lesser Sean Keenan There is a qualifying third-party indemnity provision in force for the benefit of the Directors and Officers of the Company. 17 Mineral & Financial Investments Limited DIRECTORS’ REPORT for the year ended 30 June 2023 SUBSTANTIAL SHAREHOLDINGS The only interests in excess of 3% of the issued share capital of the Company which have been notified to the Company as of 14 December 2023 were as follows: Mount Everest Finance SA* Lynchwood Nominees Limited Barry Reynolds Alasdair Coulson P Howells T Darvall Ordinary shares of 1p each number 6,894,000 3,472,000 2,987,500 1,775,000 1,661,548 1,410,920 Percentage of capital % 18.6% 9.4% 8.1% 4.8% 4.5% 3.8% *Jacques Vaillancourt is the sole shareholder of Mount Everest Finance SA DIRECTORS’ RESPONSIBILITIES FOR THE FINANCIAL STATEMENTS The Company was incorporated as a corporation in the Cayman Islands, which does not prescribe the adoption of any particular accounting framework, however the Directors are required under the AIM rules of the London Stock Exchange to prepare the Group financial statements in accordance with International Financial Reporting Standards ("IFRS") as adopted by the United Kingdom The Directors are responsible for the preparation of the Group’s financial statements, which give a true and fair view of the state of affairs of the Group and of the profit, or loss of the Group for the period. In preparing the financial statements, the directors are required to:       select suitable accounting policies and then apply them consistently. make judgments and estimates that are reasonable and prudent. state whether IFRSs as adopted by the United Kingdom have been followed, 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 Company will continue in business. The Directors are responsible for keeping adequate accounting records, for safeguarding the assets of the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. In so far as the Directors are aware at the time this report was approved: there is no relevant audit information of which the Group's auditor is unaware; and the Directors have taken all steps that they ought to have taken to make themselves aware of any relevant audit information and to establish that the auditors are aware of that information. The Directors are responsible for the maintenance and integrity of the corporate and financial information held on the Company's website. AUDITORS The auditors Shipleys LLP have indicated their willingness to continue in office and a resolution that they be reappointed will be proposed at the Annual General Meeting. For and on behalf of the Board James Lesser Director 19 December 2023 18 Mineral & Financial Investments Limited CORPORATE GOVERNANCE REPORT for the year ended 30 June 2023 The requirements of the combined code of corporate governance are not mandatory for companies traded on AIM. However, the Directors recognise the importance of sound corporate governance and have adopted corporate governance principles that the Directors consider are appropriate for a company of its size. BOARD OF DIRECTORS The Board of Directors is responsible for the Group’s system of corporate governance. It comprises an executive chairman, an executive chief operating officer and one other non-executive director. The Chairman of the Board is Mark T Brown. The Board met regularly throughout the year. It has a schedule of matters referred to it for decision, which includes strategy and future developments, allocation of financial resources, investments, annual and interim results, and risk management. INTERNAL CONTROL The Board is responsible for maintaining a strong system of internal control to safeguard shareholders’ investment and the Company’s assets and for reviewing its effectiveness. The system of internal financial control is designed to provide reasonable, but not absolute, assurance against material misstatement or loss. ANTI-CORRUPTION AND BRIBERY POLICY The Company has adopted an anti-corruption and bribery policy which applies to the Directors. It generally sets out their responsibilities in observing and upholding a zero-tolerance position on bribery and corruption in all the jurisdictions in which the Company operates as well as providing guidance on how to recognise and deal with bribery and corruption issues and the potential consequences. The Company expects all employees, suppliers, contractors and consultants to conduct their day-to-day business activities in a fair, honest and ethical manner, be aware of and refer to this policy in all of their business activities worldwide and to conduct business on the Company’s behalf in compliance with it. AUDIT COMMITTEE The Audit Committee meets twice per year and has primary responsibility for monitoring the quality of internal controls and ensuring that the financial performance of the Company is properly measured and reported on. The committee monitors the integrity of the financial statements of the Company, quarterly NAV updates and any other formal announcement relating to its financial performance. It receives and reviews reports from the Company’s management and auditors relating to the interim and annual accounts and the accounting and internal control systems in use throughout the Company. The Committee is also responsible for keeping under review the scope and results of the audit, its cost effectiveness and the independence and objectivity of the auditors. The members of the Audit Committee are Sean Keenan, James Lesser and Mark T Brown. REMUNERATION COMMITTEE The Remuneration Committee meets at least once per year to exercise independent judgement on remuneration policies, practices and incentives. The committee is created to manage risk, capital and liquidity, whilst overseeing objectives, performance and compensation of the Board Chairman, Executive Directors and Senior Management, ensuring that they are fairly rewarded (which extends to all aspects of remuneration) for their individual contribution to the overall performance of the Company. The members of the Remuneration Committee are Mark T Brown, James Lesser and Sean Keenan. COMPLIANCE WITH THE CORPORATE GOVERNANCE CODE The QCA has stated what it considers to be appropriate arrangements for growing companies and asks companies to provide an explanation about how they are meeting the principles through the prescribed disclosures. We have considered how we apply each principle to the extent that the Board judges these to be appropriate in the circumstances, and below we provide an explanation of the approach taken in relation to each. The following paragraphs set out the Company’s compliance with the ten principles of the QCA Code and reasons for any non-compliance. 19 Mineral & Financial Investments Limited CORPORATE GOVERNANCE REPORT for the year ended 30 June 2023 1. Establish a strategy and business model which promote long-term value for shareholders M&FI is an investment company whose purpose is to create value for its shareholders by investing in, financing, and advising resource companies with a particular emphasis on mining companies. The Company runs two portfolios; the Tactical Portfolio for more liquid investments in which short and medium- term value can be achieved and the Strategic Portfolio for longer-term investments. Details of the strategy of each investment portfolio are in the Tactical and Strategic portfolio pages of the Our Business section of the Company’s website. The Principal Activity and Investing Policy is set out in the Directors’ Report and also on the website. The key challenges in their execution are outlined in the Risk Management Objectives and Policies section (Note 18) of this Annual Report. 2. Seek to understand and meet shareholder needs and expectations M&FI seeks to share this vision and details of the implementation of its strategy through internal dialogue with employees as well as external communications to keep shareholders informed. The Company publishes all relevant material, according to QCA definitions, in the Investment Centre on its website. This includes annual and interim reports, quarterly net asset value updates, shareholder circulars and details of Shareholder Meetings. The Board is sensitive to all of its shareholders and commits to maintain a regular dialogue to communicate strategy, progress and to understand the needs of shareholders. Contact details are listed in the Corporate Directory and Officers & Directors pages on its website and on all announcements released via RNS, should shareholders wish to communicate with the Board. The Board believes these publications in the investor section of the website play an important part in presenting all shareholders with an assessment of the Company’s position and prospects. The Board encourages shareholders to attend its Annual General Meeting where they can meet and question the Directors and express ideas or concerns. In addition, the Directors will undertake presentations and roadshows to institutional investors as appropriate. Since the Company has a predominantly retail shareholder base, the website allows both prospective and actual shareholders to contact the Directors directly, register for automated news alerts for both regulatory and non- regulatory news, and shareholder communication is answered, where possible or appropriate, by Directors or the Company’s brokers, WH Ireland and Novum Securities. At present the Directors believe they have a good understanding of the needs and expectations of all elements of the company’s shareholder base. Feedback from shareholders to date has been positive. 3. Take into account wider stakeholder and social responsibilities and their implications for long-term success The Board recognises the need to take account of the needs of society and the environment and maintain high ethical standards. As an investment company and not an operating company the Directors identify its shareholders as its primary stakeholders. The Board recognises that the long-term success of the Company is reliant upon the efforts of its employees, advisers and regulators and additionally expects the highest standards of governance from its portfolio companies. The Company therefore maintains a regular dialogue with both its internal and external stakeholders as well as its investments. Policies to protect regular two-way dialogue with shareholders are outlined in Principle 2 of this Code. The Board takes a collective responsibility to report on regulatory matters and works closely with its advisers to ensure it operates in conformity with its listing regulations. Directors meet weekly to monitor all key stakeholder relationships. The Board understands the Company has a responsibility to consider, where practicable, the social, environmental and economic impact of its investments. The Directors are aware of the responsibilities of investee companies to the communities and environments within which they operate, and as a shareholder, expects the highest standards of governance. Good community relations and environmental sensitivity are essential to success in the resources sector and an integral part of investment decisions and advice provided by M&FI. Feedback from shareholders, advisers and employees remains positive. 20 Mineral & Financial Investments Limited CORPORATE GOVERNANCE REPORT for the year ended 30 June 2023 4. Embed effective risk management, considering both opportunities and threats, throughout the organisation The Company’s Audit Committee and Remuneration Committee meet regularly since 2018. The Company also receives regular feedback from its external auditors on the state of its internal controls. As an investment company M&FI constantly seeks to balance the various risks it undertakes with an acceptable return. In executing the company’s strategy, management will typically confront a range of day-to-day challenges associated with key markets, portfolio and projects risks and other uncertainties. The identification and management of these risks can be found in the Risk Management Objectives and Policies section in Note 18 of the Notes to these Financial Statements. They include market price risk, foreign exchange risk, credit risk, liquidity risk and capital risk management. Company management hold a daily meeting to assess and monitor all risks on a continuous basis drawing on press releases and news flow from companies and jurisdictions in which M&FI have an interest and will seek to deploy mitigation steps to manage these risks as they manifest themselves. Further, the Directors meet weekly, via conference call to review activities and opportunities with which the company is engaged. 5. Maintain the board as a well-functioning, balanced team led by the chair The Board is responsible for creating value for shareholders by formulating, reviewing and approving and monitoring the implementation of the Group’s strategy, budgets, investment and acquisition policies and corporate actions. The Board ensures that management meets plans and performance targets and is also responsible for the oversight of the governance of the company, being the systems and procedures in place by which it is directed and controlled. The Board comprises a Non-Executive Director and Chairman (Mark T Brown), Chief Executive Officer (Jacques Vaillancourt), a Non-Executive Director (Jamie Lesser) and Non-Executive Director (Sean Keenan). Mark T Brown and Sean Keenan are the independent directors of the Company. Appointments continue subject to re-election by shareholders at the AGM. A description of the roles of the Directors and their biographies are included within the Officers & Directors page of the website. All key investment decisions are subject to Board approval. The Company has appointed Audit and Remuneration committees, whose membership and responsibilities are set out on the first page of the Corporate Governance Report. The Company does not have a formally established Nominations Committee and matters that would be dealt with it are considered by the Board as a whole. Whilst the Company is guided by the provisions of the Code in respect of the independence of directors, it gives regard to the overall effectiveness and independence of the contribution made by directors to the Board in considering their independence. The Non-Executive Directors are both considered to be part-time and are required to provide their services on a timely basis. Board meetings are held at least four times a year and all directors attend these board meetings. Additionally, directors regularly attend a weekly management committee call that allows them to remain up to date on various management issues. The Board also considers that the Directors have specific expertise and experience, materially enhancing knowledge and judgement to the overall performance of the Board. Attendance at Board and its committee meetings Board Audit Remuneration Number of meetings Attendance at meetings M T Brown 4 4 2 J Vaillancourt 4   4 4 2 S Keenan 4 4 2 J Lesser 4 4  21 Mineral & Financial Investments Limited CORPORATE GOVERNANCE REPORT for the year ended 30 June 2023 6. Ensure that, between them, the directors have the necessary up-to-date experience, skills and capabilities Directors who have been appointed to the Company have been chosen because of the experience and skills they offer and maintain, by virtue of their continued involvement in the sector and other part time roles. The structure of the Board and full biographical details of all Directors are included within the Officers & Directors page of the Group’s website. Based on the M&A experience of Jacques Vaillancourt, the investment experience of Jamie Lesser and the geological expertise of Sean Keenan, the Directors are confident the Board has the right mix of skills to develop strategies for the benefit of shareholders. The Chairman, in conjunction with the Board, ensures that the Directors’ knowledge is kept up to date on key issues and developments pertaining to the Group, its operational environment and to the Directors’ responsibilities as members of the Board. During the year, Directors receive updates from the Board and various external advisers on a number of regulatory and corporate governance matters. As secretary to the Board, Miles Nicholson, Chartered Accountant, provides financial control and bookkeeping services, advises the board, manages day to day administration and liaises with Auditors for the publication of company accounts. 7. Evaluate board performance based on clear and relevant objectives, seeking continuous improvement With a small team the Board and Directors enjoy a natural on-going evaluation of performance which includes daily communication. The Company therefore undertakes continuous natural monitoring of personal and corporate performance using agreed key performance indicators and detailed financial reports. Responsibility for assessing and monitoring the performance of the executive directors lies with the Chairman and the independent non-executive directors. The Board also considers the need for the periodic refreshing of its membership. One of the Non-Executive directors was appointed in 2018 and the Non-Executive Chairman was appointed in 2021. 8. Promote a corporate culture that is based on ethical values and behaviour The Board recognises that a corporate culture based on sound ethical values and behaviours is an asset and provides competitive advantages. The Group has a strong ethical culture, which is promoted by the actions of the Board and Directors. An open culture is encouraged within the Group, with regular communications regarding progress and feedback is regularly sought. Through the daily and weekly meetings, the Board and Directors hold each other to account to ensure standards are maintained and ethical values and behaviours are recognised and respected. The Board will be fostering the framework needed for the delivery of excellence in all business decisions and actions so as to exceed the principles and industrywide standards of practice. Board performance reviews and individual director reviews ensure ethical values and behaviours are recognised, respected and maintained. 9. Maintain governance structures and processes that are fit for purpose and support good decision-making by the board As an investment company M&FI seeks to keep costs low and preserve shareholder value. As such the Company, given its size, maintains the minimum number of directors and officers required to manage a portfolio of investments, within the requirements of company law and regulation. The Chairman’s primary role is through his leadership to ensure that the Board and individual Directors are able to operate efficiently by setting the agenda, style and tone of Board discussions to promote constructive debate and effective decision making. 22 Mineral & Financial Investments Limited CORPORATE GOVERNANCE REPORT for the year ended 30 June 2023 As Chief Executive, Jacques Vaillancourt has led the management team which meets daily and is primarily responsible for the implementation of the Board’s policies and strategies, effective communication with shareholders, ensuring that all Board members develop an understanding of investors and for managing the activities of the Audit and Remuneration Committees. The Board has a formal agenda of items for consideration but is responsible for creating value for shareholders by formulating, reviewing and approving and monitoring the implementation of the Company’s strategy, budgets, investment and acquisition policies and corporate actions. The Board ensures management meet plans and performance targets and is also responsible for the oversight of the governance of the company, being the systems and procedures in place by which it is directed and controlled. At this stage in the Company’s growth, the Board believes the governance framework is sufficient. 10. Communicate how the company is governed and is performing by maintaining a dialogue with shareholders and other relevant stakeholders The Board is committed to maintaining good communication and having constructive dialogue with all of its stakeholders, providing them with access to clear and transparent information to enable them to come to informed decisions about the Company. The Company’s Investment Centre section on the website provides all required regulatory information as well as shareholder communications and additional information shareholders may find helpful including: Share Services, information on Board Members, Advisors and Significant Shareholdings, a historical list of the Company’s Announcements, its Financial Calendar, Corporate Governance information, the Company’s publications including historic Annual Reports and Notices of Annual General Meetings, together with Share Price information and interactive Charting facilities to assist shareholders analyse performance. The website is regularly updated and users can register to be alerted when announcements or details of presentations and events are posted onto the website. The Board holds regular meetings and regards the annual general meeting as a good opportunity to communicate directly with shareholders via an open question and answer session. The Company encourages two-way communication with both its institutional and private investors and endeavours to respond quickly to all queries received. The Company lists contact details on its website and on all announcements released via RNS, should shareholders wish to communicate with the Board. Results of shareholder meetings and details of votes cast will be publicly announced through the regulatory system and displayed on the Group’s website with suitable explanations of any actions undertaken as a result of any significant votes against resolutions. Information on the work of the various Board Committees and other relevant information are included on the first page of this Corporate Governance Report. Website disclosures In accordance with AIM Rule 26, the Company is required to maintain on its website details of the QCA code, how the Company complies with the QCA code and an explanation of any deviations from such code. This information is required to be reviewed annually and it is intended that it will be reviewed at the same time as the Company's Annual Report is prepared. Further information about the Company's charters, policies and procedures may be found on the Company's website at www.mineralandfinancial.com, under the section titled "Corporate Governance". This Corporate Governance Statement is dated 19 December 2023 and has been approved by the Board. 23 Mineral & Financial Investments Limited REPORT ON REMUNERATION for the year ended 30 June 2023 DIRECTORS' REMUNERATION The Board recognises that Directors' remuneration is of legitimate concern to the shareholders, and it is committed to following current best practice. The Company operates within a competitive environment and its performance depends on the effective contributions of the Directors and employees who are compensated accordingly. DIRECTORS' REMUNERATION The remuneration of the Directors was as follows: Mark T Brown Jacques Vaillancourt James Lesser Sean Keenan Year ended 30 June 2023 Salary and fees £'000 Pension £’000 25 60 10 10 105      Total £'000 25 60 10 10 105 Year ended 30 June 2022 Salary and fees £'000 Pension £'000 25 60 10 10 105      Total £’000 25 60 10 10 105 PENSIONS No pension contributions were paid in respect of the directors for the year ended 30 June 2023, or for the year ended 30 June 2022. BENEFITS IN KIND The Directors did not receive any benefits in kind, either in the year ended 30 June 2023, or for the year ended 30 June 2022. BONUSES There were no bonuses payable either for the year ended 30 June 2023, or for the year ended 30 June 2022. DIRECTORS’ INTERESTS IN THE COMPANY’S SHARES The interests of the Directors, their immediate families, and persons connected with them in the issued share capital of the Company (all of which are beneficial) are set out below. Jacques Vaillancourt* Sean Keenan James Lesser Ordinary shares of 1p each number 6,894,000 100,000 223,880 Percentage of capital 18.6% 0.3% 0.6% *Jacques Vaillancourt’s shareholding is held by Mount Everest Finance SA, a company in which he has a 100% beneficial holding. 24 Mineral & Financial Investments Limited REPORT ON REMUNERATION for the year ended 30 June 2023 RESTRICTED SHARE UNITS On 10 June 2022, Directors were granted Restricted Share Units “RSUs” as follows. Further details of the RSUs are disclosed in note 14. Mark T Brown Jacques Vaillancourt Sean Keenan James Lesser Number of RSUs 275,000 400,000 275,000 200,000 Reference market price 11.75p 11.75p 11.75p 11.75p Further details of the RSUs granted are disclosed in note 14. SHARE OPTION INCENTIVES Directors held options as follows. At beginning of period Granted in period Exercised in period Lapsed in period Jacques Vaillancourt James Lesser 1,000,000 500,000       Further details of options granted are disclosed in note 14. At end of period 1,000,000 500,000 Average Exercise price 13.50p 13.50p For and on behalf of the Board Mark T Brown Director 19 December 2023 25 Mineral & Financial Investments Limited INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF MINERAL & FINANCIAL INVESTMENTS LIMITED for the year ended 30 June 2023 OPINION We have audited the financial statements of Mineral & Financial Investments Ltd (the 'Group') for the year ended 30 June 2023 which comprise the Consolidated Statement of Comprehensive Income, Consolidated Balance Sheet, Consolidated Statement of Changes in Equity, Consolidated Cash Flow Statement and related notes including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and International Financial Reporting Standards (IFRSs) as adopted by the European Union. In our opinion:    the financial statements give a true and fair view of the state of the Group's affairs as at 30 June 2023 and of the Group's profit for the year then ended; the Group financial statements have been properly prepared in accordance with IFRSs as adopted by the United Kingdom; the financial statements have been prepared in accordance with the requirements of relevant legislation. 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 Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the Group 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. AN OVERVIEW OF THE SCOPE OF OUR AUDIT Our Group audit was scoped by obtaining an understanding of the Group and its environment, including the Group’s system of internal control, and assessing the risks of material misstatement in the financial statements. We also addressed the risk of management override of internal controls, including assessing whether there was evidence of bias by the Directors that may have represented a risk of material misstatement. The components of the Group were evaluated by the Group audit team based on a measure of materiality, considering each component as a percentage of the Group’s gross assets, which allowed the Group audit team to assess the significance of each component and determine the planned audit response. For those components that were evaluated as significant components, either a full scope or specified audit approach was determined based on their relative materiality to the Group and our assessment of the audit risk. For significant components requiring a full scope approach, we evaluated controls by performing walkthroughs over the financial reporting systems identified as part of our risk assessment, reviewed the accounts production process and addressed critical accounting matters. We then undertook substantive testing on significant transactions and material account balances. In order to address the audit risks identified during our planning procedures, we performed a full scope audit of the Parent Company and subsidiary companies. All work was carried out by the Group audit team. 26 Mineral & Financial Investments Limited INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF MINERAL & FINANCIAL INVESTMENTS LIMITED for the year ended 30 June 2023 CONCLUSIONS RELATING TO GOING CONCERN In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate. Based on the work performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue. Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report. OUR ASSESSMENT OF RISKS OF MATERIAL MISSTATEMENT The assessed risks of material misstatement described below are those that had the greatest effect on our audit strategy, the allocation of resources in the audit and directing the efforts of the engagement team. Risk How the scope of our audit responded to the risk Management override of controls Journals can be posted which give rise to the risk of misstatement or fraud in the financial statements Going Concern There is a risk that the company and Group may hold insufficient working capital to allow it to meet its financial obligations as they fall due thus giving rise to a going concern risk. Fraud in Revenue Recognition There is a risk that revenue is materially understated due to fraud. We examined journals posted around the year end, specifically focusing on areas which are more easily manipulated such as accruals, prepayments, bank reconciliations and tax. Existing cash reserves have been evidenced and future cashflow forecasts have been reviewed to ensure sufficient cash headroom exists for a period of at least one year from the date of approving these financial statements. Income was tested on a sample basis for completeness, and we concluded that no evidence of fraud or other understatement was identified. Accounting Estimates Potential risk of inappropriate accounting estimates giving rise to misstatement in the accounts. We have considered the basis of the accounting estimates applied when preparing the financial statements and considered the responses to audit questions with professional scepticism. Risk of material misstatement within related party transactions There related party is transactions are potentially incomplete or materially misstated. that risk the Correspondence and accounting records were reviewed for evidence of material related party transactions and it is considered that all relevant items have been disclosed. Disclosures There is a risk of incorrect or incomplete disclosures in the financial statements. The financial statements have been reviewed and checks have been undertaken to ensure all material disclosure requirements have been met. Our audit procedures relating to these matters were designed in the context of our audit of the Financial Statements as a whole, and not to express an opinion on individual accounts or disclosures. Our opinion on the Financial Statements is not modified with respect to any of the risks described above, and we do not express an opinion on these individual matters. 27 Mineral & Financial Investments Limited INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF MINERAL & FINANCIAL INVESTMENTS LIMITED for the year ended 30 June 2023 OUR APPLICATION OF MATERIALITY We define materiality as the magnitude of misstatement in the Financial Statements that makes it probable that the economic decisions of a reasonably knowledgeable person would be changed or influenced. We use materiality both in planning and in the scope of our audit work and in evaluating the results of our work. We determine materiality for the Group to be £136,800 and this financial benchmark, which has been used throughout the audit, was determined by way of a standard formula being applied to key financial results and balances presented in the Financial Statements. Where considered relevant the materiality is adjusted to suit the specific area risk profile of the Group. OTHER INFORMATION The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. The Directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and we do not express any form of assurance conclusion thereon. In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard. OPINION ON OTHER MATTERS In our opinion, based on the work undertaken in the course of the audit:   the information given in the Group Strategic Report and the Directors’ Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and the Group 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 its environment obtained in the course of the audit, we have not identified material misstatements in the Group Strategic Report or the Directors’ Report. We have nothing to report in respect of the following matters in relation to which relevant legislation requires us to report to you if, in our opinion:  adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or  the financial statements are not in agreement with the accounting records and returns; or  certain disclosures of Directors' remuneration specified by law are not made; or  we have not received all the information and explanations we require for our audit. RESPONSIBILITIES OF DIRECTORS As explained more fully in the Statement of Directors' Responsibilities set out in the Directors’ Report the Directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the Directors determine necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. 28 Mineral & Financial Investments Limited INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF MINERAL & FINANCIAL INVESTMENTS LIMITED for the year ended 30 June 2023 In preparing the financial statements, the Directors are responsible for assessing the Group'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 to cease operations, or have no realistic alternative but to do so. OUR 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 a Report of the Auditors 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. A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our Report of the Auditors. EXPLANATION AS TO WHAT EXTEND THE AUDIT WAS CONSIDERED CAPABLE OF DETECTING IRREGULARITIES, INCLUDING FRAUD 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. The objectives of our audit in respect of fraud, are; to identify and assess the risks of material misstatement of the financial statements due to fraud; to obtain sufficient appropriate audit evidence regarding the assessed risks of material misstatement due to fraud, through designing and implementing appropriate responses to those assessed risks; and to respond appropriately to instances of fraud or suspected fraud identified during the audit. However, the primary responsibility for the prevention and detection of fraud rests with both management and those charged with governance of the Company. Our approach was as follows: • We obtained an understanding of the legal and regulatory requirements applicable to the Group and considered that the most significant are the international accounting standards as adopted by the United Kingdom, the rules of the Alternative Investment Market, and relevant legislation. • We obtained an understanding of how the Group complies with these requirements by discussions with management and those charged with governance. • We assessed the risk of material misstatement of the financial statements, including the risk of material misstatement due to fraud and how it might occur, by holding discussions with management and those charged with governance. • We inquired of management and those charged with governance as to any known instances of non-compliance or suspected non-compliance with laws and regulations; and • Based on this understanding, we designed specific appropriate audit procedures to identify instances of non- compliance with laws and regulations. This included making enquiries of management and those charged with governance and obtaining additional corroborative evidence as required. • Agreeing the financial statement disclosures to underlying supporting documentation. 29 Mineral & Financial Investments Limited INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF MINERAL & FINANCIAL INVESTMENTS LIMITED for the year ended 30 June 2023 • Assessing the susceptibility of the Group and Parent Company financial statements to material misstatement, including how fraud might occur by making enquiries of the Directors during the planning and execution phases of our audit. We considered the area in which fraud might occur was in the management override of controls. In response our procedures included, but were not limited to. - Addressing the risk of fraud through management override of controls by testing the appropriateness of a sample of journal entries where we considered there to be a higher risk of potential fraud and other adjustments, assessing whether the judgements made in making accounting estimates specifically those in the key audit matters section of the report are indicative of a potential bias, and evaluating the business rationale of any significant transactions that are unusual or outside the normal course of business; - Testing the consolidation entries for consistency and appropriateness of application There are inherent limitations in the audit procedures described above. We are less likely to become aware of instances of non-compliance with laws and regulations that are not closely related to events and transactions reflected in the financial statements. Also, the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion. USE OF OUR REPORT This report is made solely to the Company's members, as a body, in accordance with relevant legislation. Our audit work has been undertaken so that we might state to the Company's members those matters we are required to state to them in a Report of the Auditor and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company and the Company's members as a body, for our audit work, for this report, or for the opinions we have formed. Joseph Kinton (Senior Statutory Auditor) For and on behalf of Shipleys LLP Chartered Accountants and Statutory Auditors 10 Orange Street Haymarket London WC2H 7DQ Date 19 December 2023 30 Mineral & Financial Investments Limited CONSOLIDATED INCOME STATEMENT AND CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME for the year ended 30 June 2023 Investment income Fee revenue Net gains on disposal of investments Net change in fair value of investments Operating expenses Share based payment expense Other gains and losses Profit before taxation Taxation expense Year ended 30 June 2023 £’000 Year ended 30 June 2022 £’000 Notes 119  2,108 167 2,394 (452) (136) (230) 1,576 (26) 3 5 6 128  861 308 1,297 (439) (92) 133 899  Profit for the year from continuing operations and total comprehensive income, attributable to owners of the Company 1,550 899 Profit per share attributable to owners of the Company during the year from continuing and total operations: 7 Pence Pence Basic (pence per share) Fully diluted (pence per share) 4.4 4.0 2.5 2.5 The accompanying notes form an integral part of these financial statements 31 Mineral & Financial Investments Limited CONSOLIDATED STATEMENT OF FINANCIAL POSITION as at 30 June 2023 CURRENT ASSETS Financial assets held at fair value through profit or loss Trade and other receivables Cash and cash equivalents CURRENT LIABILITIES Trade and other payables Convertible unsecured loan notes NET CURRENT ASSETS NON-CURRENT LIABILITIES Deferred tax provision NET ASSETS EQUITY Share capital Share premium Loan note equity reserve Reserve for employee share schemes Capital reserve Retained earnings Equity attributable to owners of the Company and total equity Notes 8 10 11 12 2023 £’000 8,925 25 796 9,746 194 10 204 2022 £’000 7,183 18 481 7,682 125 10 135 9,542 7,547 13 (119) (93) 15 15 16 17 9,423 7,454 3,114 6,182 6 228 15,736 (15,843) 3,099 5,914 6 92 15,736 (17,393) 9,423 7,454 The financial statements were approved by the Board and authorised for issue on 19 December 2023 Mark T. Brown Chairman 32 Mineral & Financial Investments Limited CONSOLIDATED STATEMENT OF CHANGES IN EQUITY for the year ended 30 June 2023 Share capital £'000 Share premium £'000 Reserve for employee share schemes £'000 Loan note reserve £'000 Capital reserve £'000 Accumulated losses £'000 Total equity £'000 At 1 July 2021 3,096 5,892 Total comprehensive income for the year Share based payment expense Exercise of options   3   22 At 30 June 2022 3,099 5,914 Total comprehensive income for the year Share based payment expense Issues of equity   15   268 23  92 (23) 92  136  6    6    15,736 (18,315) 6,438    899  23 899 92 25 15,736 (17, 393) 7,454    1,550 1,550   136 283 At 30 June 2023 3,114 6,182 228 6 15,736 (15,843) 9,423 The accompanying notes form an integral part of these financial statements 33 Mineral & Financial Investments Limited CONSOLIDATED STATEMENT OF CASH FLOWS for the year ended 30 June 2023 OPERATING ACTIVITIES Profit before taxation Adjustments for: Profit on disposal of trading investments Fair value loss/(gain) on trading investments Investment income Share based payment expense Operating cash flow before working capital changes (Increase)/decrease in trade and other receivables Increase/(decrease) in trade and other payables Net cash outflow from operating activities INVESTING ACTIVITIES Purchase of financial assets Disposal of financial assets Investment income Net cash (outflow)/inflow from investing activities FINANCING ACTIVITIES Proceeds of share issues Net cash inflow from financing activities Net (decrease)/increase in cash and cash equivalents Cash and cash equivalents as at 1 July Cash and cash equivalents as at 30 June Year ended 30 June 2023 £’000 Year ended 30 June 2022 £’000 Notes 1,576 (2,108) (167) (119) 136 (682) (7) 69 (620) (3,783) 4,396 39 652 282 282 315 481 796 899 (861) (308) (128) 92 (306) 9 (52) (348) (2,177) 2,098 29 (50) 25 25 (374) 855 481 The accompanying notes form an integral part of these financial statements 34 Mineral & Financial Investments Limited NOTES TO THE FINANCIAL STATEMENTS for the year ended 30 June 2023 1 GENERAL INFORMATION The Company was incorporated as a Corporation in the Cayman Islands which does not prescribe the adoption of any particular accounting framework. The Board has therefore adopted International Financial Reporting Standards as adopted by the United Kingdom. The Company's shares are listed on the AIM market of the London Stock Exchange. The Company is exempt from the requirement to prepare, and file audited financial statements under Cayman Islands law, so the Group consolidated financial statements have been prepared without the inclusion of parent company information. The Company is an investment company, mainly investing in natural resources, minerals, metals, and oil and gas projects. The registered office of the Company is as detailed in the Company Information on page 2. These financial statements are prepared in pounds sterling which is the Company’s functional and presentational currency and rounded to the nearest £’000. 2 PRINCIPAL ACCOUNTING POLICIES BASIS OF PREPARATION The financial statements have been prepared under the historical cost convention, and in accordance with International Financial Reporting Standards (“IFRS”), as adopted by the United Kingdom, and International Financial Reporting Interpretations Committee (“IFRIC”) interpretations. All accounting standards and interpretations issued by the International Accounting Standards Board and IFRIC effective for the periods covered by these financial statements have been applied. The principal accounting policies of the Company are set out below and have been consistently applied to all periods. BASIS OF CONSOLIDATION The Group financial statements incorporate the financial statements of the Company and entities controlled by the Company (its subsidiaries). Control is achieved where the Company has the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities. The subsidiaries have a reporting date of 30 June. The results of subsidiaries acquired or disposed of during the year are included in the consolidated statement of comprehensive income from the effective date of acquisition or up to the effective date of disposal, as appropriate. Where necessary, adjustments are made to the financial statements of subsidiaries to bring their accounting policies in line with those used by other members of the Group. All intra-group transactions, balances, income and expenses are eliminated in full on consolidation. Non-controlling interests in the net assets of consolidated subsidiaries are identified separately from the Group’s equity therein. Non-controlling interests consist of the amount of those interests at the date of the original business combination and the minority’s share of changes in equity since the date of the combination. Losses applicable to the non-controlling interests in excess of the minority’s interest in the subsidiary’s equity are recorded as a debit to non-controlling interest regardless of whether there is an obligation in the part of the holders of non-controlling interests for losses. 35 Mineral & Financial Investments Limited NOTES TO THE FINANCIAL STATEMENTS for the year ended 30 June 2023 GOING CONCERN The Directors have prepared cash flow forecasts through to 31 December 2024 which assume no significant investment activity is undertaken unless sufficient funding is in place to undertake the investment activity. The expenses of the Group's continuing operations are minimal, and the cash flow forecasts demonstrate that the Group is able to meet its obligations as they fall due. The directors have also considered the impact of Covid-19 and have concluded that there are no material factors which are likely to affect the ability of the Group to continue as a going concern, as a result of the cash reserves in place and given the Group’s ongoing costs. On this basis, the Directors have a reasonable expectation that the Group has adequate resources to continue operating for the foreseeable future. For this reason they continue to adopt the going concern basis in preparing the Group’s financial statements. KEY ESTIMATES AND ASSUMPTIONS Estimates and assumptions used in preparing the financial statements are reviewed on an on-going basis and are based on historical experience and various other factors that are believed to be reasonable under the circumstances. The results of these estimates and assumptions form the basis of making judgments about carrying values of assets and liabilities that are not readily apparent from other sources: SHARE BASED PAYMENTS The calculation of the fair value of equity-settled share-based awards and the resulting charge to the statement of comprehensive income requires assumptions to be made regarding future events and market conditions. These assumptions include the future volatility of the Company’s share price. These assumptions are then applied to a recognised valuation model in order to calculate the fair value of the awards. FAIR VALUE OF FINANCIAL INSTRUMENTS The Group holds investments that have been designated as held at fair value through profit or loss on initial recognition. The company determines the fair value of quoted financial instruments using quoted prices in active markets for identical assets or liabilities (level 1). Where practicable the Company determines the fair value of the financial instruments that are not quoted (Level 3) using the most recent bid price at which a transaction has been carried out. These techniques are significantly affected by certain key assumptions, such as market liquidity. Other valuation methodologies such as discounted cash flow analysis assess estimates of future cash flows and it is important to recognise that in that regard, the derived fair value estimates cannot always be substantiated by comparison with independent markets and, in many cases, may not be capable of being realised immediately. CHANGES IN ACCOUNTING POLICIES AND DISCLOSURES The Company and its subsidiaries ("the Group") has adopted all new and amended accounting standards and interpretations as adopted by the United Kingdom (IFRSs) for the reporting periods beginning on or after 1 July 2022. The Directors have reviewed all new Standards and Interpretations that have been issued but are not yet effective for the year ended 30 June 2023. As a result of this review, the Directors have determined that there is no material impact of the new and revised Standards and Interpretations on the Group and, therefore, no change is necessary to Group accounting policies. INVESTMENT INCOME Dividend income from financial assets at fair value through profit or loss is recognised in the statement of comprehensive income on an ex-dividend basis. Interest on fixed interest debt securities, designated at fair value through profit or loss, is recognised using the effective interest rate method. 36 Mineral & Financial Investments Limited NOTES TO THE FINANCIAL STATEMENTS for the year ended 30 June 2023 2 PRINCIPAL ACCOUNTING POLICIES (continued) TAXATION Current income tax assets and/or liabilities comprise those obligations to, or claims from, fiscal authorities relating to the current or prior reporting period, that are unpaid at the balance sheet date. They are calculated according to the tax rates and tax laws applicable to the fiscal periods to which they relate, based on the taxable result for the year. All changes to current tax assets or liabilities are recognised as a component of tax expense in the income statement. Deferred income taxes are calculated using the liability method on temporary differences. This involves the comparison of the carrying amounts of assets and liabilities in the consolidated financial statements with their respective tax bases. However, deferred tax is not provided on the initial recognition of goodwill, nor on the initial recognition of an asset or liability, unless the related transaction is a business combination or affects tax or accounting profit. In addition, tax losses available to be carried forward as well as other income tax credits to the Group are assessed for recognition as deferred tax assets. Deferred tax liabilities are always provided for in full. Deferred tax assets are recognised to the extent that it is probable that they will be able to be offset against future taxable income. Deferred tax assets and liabilities are calculated, without discounting, at tax rates that are expected to apply to their respective period of realisation, provided they are enacted or substantively enacted at the balance sheet date. Most changes in deferred tax assets or liabilities are recognised as a component of tax expense in the income statement. Only changes in deferred tax assets or liabilities that relate to a change in value of assets or liabilities that is charged directly to equity are charged or credited directly to equity. FINANCIAL ASSETS The Group's financial assets comprise investments held for trading, cash and cash equivalents and loans and receivables, and are recognised in the Group’s statement of financial position when the Group becomes a party to the contractual provisions of the instrument. FINANCIAL ASSET INVESTMENTS CLASSIFICATION OF FINANCIAL ASSETS The Group holds financial assets including equities and debt securities. On the initial recognition, the Group classifies financial assets as measured at amortised cost or fair value through profit or loss(“FVTPL”). A financial asset is measured at amortised cost if it meets both of the following conditions and is not designated as at FVTPL:   It is held within a business model whose objective is to hold assets to collect contractual cash flows; and its contractual terms give rise on specific dates to cash flows that are Solely Payments of Principal and Interest (SPPI). All other financial assets of the Group are measured at FVTPL. 37 Mineral & Financial Investments Limited NOTES TO THE FINANCIAL STATEMENTS for the year ended 30 June 2023 2 PRINCIPAL ACCOUNTING POLICIES (CONTINUED) BUSINESS MODEL ASSESSMENT In making an assessment of the objective of the business model in which a financial asset is held, the Company considers all of the relevant information on how the business is managed, including:     the documented investment strategy and the execution of this strategy in practice. This includes whether the investment strategy focuses on earning contractual interest income, maintaining a particular interest rate profile, matching the duration of the financial assets to the duration of any related liabilities or expected cash outflows or realised cash flows through the sale of the assets; how the performance of the portfolio is evaluated and reported to the Company’s management; the risks that affect the performance of the business model (and the financial assets held within that business model) and how those risks are managed; how the investment advisor is compensated e.g. whether compensation is based on the fair value of the assets managed or the contractual cashflows collected IFRS 9 subsection B4.1.1-B4.1.2 stipulates that the objective of the entity’s business model is not based on management’s intentions with respect to an individual instrument, but rather determined at a higher level of aggregation. The assessment needs to reflect the way that an entity manages its business. The company has determined that it has two business models.  Held-to-collect business model: this includes cash and cash equivalents, balances due from brokers and other receivables. These financial assets are held to collect contractual cash flows.  Other Business model: this includes structured finance products, equity investments, investments in unlisted private equities and derivatives. These financial assets are managed and their performance is evaluated, on a fair value basis with frequent sales taking place in respect to equity holdings. If the credit risk on a financial instrument has increased significantly since initial recognition, the loss allowance is equal to the lifetime expected credit losses. If the credit risk has not increased significantly, the loss allowance is equal to twelve month expected credit losses. VALUATION OF FINANCIAL ASSET INVESTMENTS Investment transactions are accounted for on a trade date basis. Assets are de-recognised at the trade date of the disposal. Assets are sold at their fair value, which comprises the proceeds of sale less any transaction cost. The valuations in respect of unquoted investments (Level 3 financial assets) are explained in note 8. Changes in the fair value of investments held at fair value through profit or loss and gains and losses on disposal are recognised in the consolidated statement of comprehensive income as “Net gains/(losses) on investments”. Investments are initially measured at fair value plus incidental acquisition costs. Subsequently, they are measured at fair value. This is either the bid price or the last traded price, depending on the convention of the exchange on which the investment is quoted. CASH AND CASH EQUIVALENTS Cash and cash equivalents comprise cash on hand and demand deposits, together with other short-term, highly liquid investments that are readily convertible into known amounts of cash and which are subject to an insignificant risk of changes in value. TRADE AND OTHER RECEIVABLES Trade receivables are initially recognised at fair value and subsequently measured at amortised cost using the effective interest method, less any allowance for expected credit losses. Trade receivables are generally due for settlement within 30 days. The consolidated entity has applied the simplified approach to measuring expected credit losses, which uses a lifetime expected loss allowance. To measure the expected credit losses, trade and other receivables have been grouped based on days overdue. Generally there are no trade receivables. Other receivables are recognised at amortised cost, less any allowance for expected credit losses. 38 Mineral & Financial Investments Limited NOTES TO THE FINANCIAL STATEMENTS for the year ended 30 June 2023 2 PRINCIPAL ACCOUNTING POLICIES (continued) EQUITY An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities. Equity instruments issued by the Company are recorded at the proceeds received net of direct issue costs. The share premium account represents premiums received on the initial issuing of the share capital. Any transaction costs associated with the issuing of shares are deducted from share premium. The share option reserve represents the cumulative cost of share-based payments. The loan note reserve represents the value of the equity component of the nominal value of the loan notes issued. The capital reserve represents amounts arising in connection with reverse acquisitions. Retained earnings include all current and prior period results as disclosed in the statement of comprehensive income. FINANCIAL LIABILITIES Financial liabilities are recognised in the Group’s balance sheet when the Group becomes a party to the contractual provisions of the instrument. All interest related charges are recognised as an expense in finance cost in the income statement using the effective interest rate method. The Group's financial liabilities comprise convertible loan notes, and trade and other payables. The fair value of the liability portion of the convertible loan notes is determined using a market interest rate for an equivalent non-convertible loan note. This amount is recorded as a liability on an amortised cost basis until extinguished on conversion or maturity of the loan notes. The remainder of the proceeds is allocated to the conversion option, which is recognised and included in shareholders’ equity, net of tax effects. Trade payables are recognised initially at their fair value and subsequently measured at amortised cost less settlement payments. SHARE BASED PAYMENTS The Group operates equity settled share-based remuneration plans for the remuneration of its employees. All services received in exchange for the grant of any share-based remuneration are measured at their fair values. These are indirectly determined by reference to the fair value of the share options awarded. Their value is appraised at the grant date and excludes the impact of any non-market vesting conditions (for example, profitability and sales growth targets). Share based payments are ultimately recognised as an expense in the income statement with a corresponding credit to retained earnings in equity, net of deferred tax where applicable. If vesting periods or other vesting conditions apply, the expense is allocated over the vesting period, based on the best available estimate of the number of share options expected to vest. Non-market vesting conditions are included in assumptions about the number of options that are expected to become exercisable. Estimates are subsequently revised, if there is any indication that the number of share options expected to vest differs from previous estimates. No adjustment is made to the expense or share issue cost recognized in prior periods if fewer share options ultimately are exercised than originally estimated. Upon exercise of share options, the proceeds received net of any directly attributable transaction costs up to the nominal value of the shares issued are allocated to share capital with any excess being recorded as share premium. Where share options are cancelled, this is treated as an acceleration of the vesting period of the options. The amount that otherwise would have been recognised for services received over the remainder of the vesting period is recognised immediately within profit or loss. 39 Mineral & Financial Investments Limited NOTES TO THE FINANCIAL STATEMENTS for the year ended 30 June 2023 2 PRINCIPAL ACCOUNTING POLICIES (continued) FOREIGN CURRENCIES The Directors consider Sterling to be the currency that most faithfully represents the economic effects of the underlying transactions, events and conditions. The financial statements are presented in Sterling, which is the Company’s functional and presentation currency. Foreign currency transactions are translated into Sterling using the exchange rates prevailing at the date of the transactions. Foreign currency exchange gains and losses resulting from the settlement of such transactions and from the translation of monetary assets and liabilities denominated in foreign currencies at year end exchange rates are recognised in the income statement. Non-monetary items that are measured at historical costs in a foreign currency are translated at the exchange rate at the date of the transaction. Non-monetary items that are measured at fair value in a foreign currency are translated into the functional currency using the exchange rates at the date when the fair value was determined. SEGMENTAL REPORTING A segment is a distinguishable component of the Group's activities from which it may earn revenues and incur expenses, whose operating results are regularly reviewed by the Group's chief operating decision maker to make decisions about the allocation of resources and assessment of performance and about which discrete financial information is available. As the chief operating decision maker reviews financial information for and makes decisions about the Group's investment activities as a whole, the directors have identified a single operating segment, that of holding and trading in investments in natural resources, minerals, metals, and oil and gas projects. The directors consider that it would not be appropriate to disclose any geographical analysis of the Group’s investments. 3 OPERATING PROFIT Profit from operations is arrived at after charging: Directors fees Other salary costs Share based payment expense Registrars fees Corporate adviser and broking fees Other professional fees Foreign exchange differences Other administrative expenses Fees payable to the Group’s auditor: For the audit of the Group’s consolidated financial statements 2023 £’000 2022 £’000 105 23 136 36 37 197 230 34 20 818 105 20 92 31 39 180 (133) 44 20 398 40 Mineral & Financial Investments Limited NOTES TO THE FINANCIAL STATEMENTS for the year ended 30 June 2023 4 EMPLOYEE REMUNERATION The expense recognised for employee benefits is analysed below; the Group has no employees other than the directors of the parent company and its subsidiary; average number of employees, including executive directors, 2 (2022, 2): Wages and salaries Share based payment expense 2023 £’000 127 136 263 2022 £’000 124 92 216 Details of Directors’ employee benefits expense are included in the Report on Remuneration. Remuneration for key management of the Company, including amounts paid to Directors of the Company, is as follows: Short-term employee benefits Share based payment expense 5 OTHER GAINS AND LOSSES Foreign currency exchange differences 6 INCOME TAX EXPENSE Deferred tax charge relating to unrealised gains on investments Other tax payable 2023 £’000 105 118 223 2023 £’000 (230) (230) 2023 £’000 26  26 2022 £’000 105 77 182 2022 £’000 133 133 2022 £’000    The tax on the Group's profit before tax differs from the theoretical amount that would arise using the weighted average rate applicable to the results of the Consolidated entities as follows: Profit before tax from continuing operations Profit before tax multiplied by rate of federal and cantonal tax in Switzerland of 14.6% (2022: 14.6%) Less abatement in respect of long term investment holdings Unrelieved tax losses Under/(overprovided) in previous period Total tax 2023 £’000 1,576 230 (207)  3 26 2022 £’000 899 131 (118)  (13)  41 Mineral & Financial Investments Limited NOTES TO THE FINANCIAL STATEMENTS for the year ended 30 June 2023 7 EARNINGS PER SHARE The basic and diluted earnings per share are calculated by dividing the profit attributable to owners of the Company by the weighted average number of ordinary shares in issue during the year. Profit attributable to owners of the Company - Continuing and total operations Weighted average number of shares for calculating basic earnings per share Weighted average number of shares for calculating fully diluted earnings per share Earnings per share from continuing and total operations - Basic (pence per share) - Fully diluted (pence per share) 8 INVESTMENTS HELD AT FAIR VALUE THROUGH PROFIT OR LOSS 1 July – Investments at fair value Cost of investment purchases Proceeds of investment disposals Profit on disposal of investments Fair value adjustment Accrued interest on loan notes 30 June – Investments at fair value Categorised as: Level 1 - Quoted investments Level 3 - Unquoted investments 2023 £’000 1,550 2023 2022 £’000 899 2022 35,611,416 35,271,011 38,511,416 35,271,011 4.4 4.0 2.5 2.5 2023 £’000 7,183 3,783 (4,396) 2,108 167 80 8,925 3,835 5,090 8,925 2022 £’000 5,822 2,177 (2,098) 861 308 113 7,183 2,237 4,946 7,183 The Group has adopted fair value measurements using the IFRS 13 fair value hierarchy. Categorisation within the hierarchy has been determined on the basis of the lowest level of input that is significant to the fair value measurement of the relevant asset as follows: Level 1 – valued using quoted prices in active markets for identical assets. Level 2 – valued by reference to valuation techniques using observable inputs other than quoted prices included in Level 1. Level 3 – valued by reference to valuation techniques using inputs that are not based on observable market criteria. 42 Mineral & Financial Investments Limited NOTES TO THE FINANCIAL STATEMENTS for the year ended 30 June 2023 8 INVESTMENTS HELD AT FAIR VALUE THROUGH PROFIT OR LOSS (continued) LEVEL 3 investments Reconciliation of Level 3 fair value measurement of investments Brought forward Purchases Proceeds of investment disposals Profit on disposal of investments Fair value adjustment Carried forward 2023 £’000 4,946 307 (238) 90 (639) 4,466 2022 £’000 4,110 152   684 4,946 Level 3, unquoted investments are valued on the basis of the last fund raise, except for Redcorp where the value has been based on the net present value of the cash flows from the project. Valuation techniques used by the Group are explained on page 32 (Fair value of financial instruments) The Group’s largest Level 3 investment is Redcorp Empreendimentos Mineiros LDA (“Redcorp”). REDCORP EMPREENDIMENTOS MINEIROS LDA Redcorp is a Portuguese exploration development and mining company whose main asset is the Polymetallic) Lagoa Salgada Volcanogenic Massive Sulphide (VMS) Project, which has resources of zinc, lead, copper, gold, silver, tin, and indium. In June 2018, TH Crestgate entered into an agreement with Ascendant Resources Inc (“Ascendant”) under which Ascendant initially acquired 25% of the equity in Redcorp for a consideration of US$2.45 million, composed of US$1.65 million in Ascendant shares and US$800,000 in cash. The second part of the Agreement was an Earn-in Option under which Ascendant had the right to earn a further effective 25% interest via staged payments amounting to US$3.5 million. In addition, Ascendant was required to spend a minimum of US$9.0 million directly on the Lagoa Salgada Project within 48 months of the closing date, to fund exploration drilling, metallurgical test work, economic studies and other customary activities for exploration and development. Under the last part of the agreement Ascendant was able to acquire an additional 30% taking its total interest to 80% by the payment of US$2,500,000 on or before 22 Dec 2022 This date was amended so that the cash payment had to be received on/or before 22 June 2023. In addition, a feasibility study was to be delivered by 22 August 2023. To date the payments due from Ascendant under the agreement have all been fulfilled. The Group’s investment in Redcorp has been valued on a discounted cash flow basis using a 20% discount rate from the from the Feasibility Study completed in July 2023. As at 30 June 2023, Mineral and Financial Investments AG owned 50% of Redcorp (2022: 50%). Redcorp currently owns 85% of the Lagoa Salgada project. M&F agreed in June 2017 with Empresa Desenvolvimento Mineiro SA (EDM), a Portuguese State-owned company, to re-acquire EDM’s 15% rights on the project resulting in Redcorp holding a 100% ownership of the project. The 2017 agreement was subject to the Portuguese Secretary of State’s approval which was not received. Redcorp and M&F continue to explore ways and means to complete the purchase. EDM’s right is an option, if exercised, to receive a 15% working interest (“WI”) in the Lagoa Salgada Project. This 15% WI is subject to a Right of First Refusal (“ROFR”) if EDM exercises the Option and choses to sell its interest. The WI is subject to standard dilution features if financial obligations are unsatisfied. This option expires 120 days after the delivery of a Feasibility Study. M&F has granted Ascendant conditional options that would, if exercised, result in Ascendant owning (net) 80% interest in the Project if M&F is unsuccessful in re-acquiring EDM’s rights/interest. Within 6 months & 10 days after the delivery of the Feasibility Study. If EDM opt to not exercise its Option, M&F’s would retain its 20% Carried Interest and the adjusting call options held by Ascendant would be nullified. If EDM exercises its option to the 15% CI then M&F would retain a (net) 5% CI. M&F has the right to sell its (net) 5% CI to Ascendant at a price representing 43 Mineral & Financial Investments Limited NOTES TO THE FINANCIAL STATEMENTS for the year ended 30 June 2023 M&F’s 5% share of the NPV of the PLS Project as estimated in the Feasibility Study (using a 10.5% Discount Rate). We currently estimate that this value would be significantly higher than the year end value. 9 SUBSIDIARY COMPANIES The Group’s subsidiary companies are as follows: Name Mineral & Financial Investments AG Principal activity Investment company Country of incorporation and principal place of business Proportion of ownership interest and voting rights held by the Group Steinengraben 18 4051 Basel, Switzerland M&FI Services Ltd Service company 5 Bath Road, London, United Kingdom, W4 1LL All intergroup transactions and balances are eliminated on consolidation. 10 TRADE AND OTHER RECEIVABLES Other receivables Prepayments Total 100% 100% 2023 £’000 10 15 25 2022 £’000 12 6 18 The fair value of trade and other receivables is considered by the Directors not to be materially different to the carrying amounts. At the balance sheet date in 2023 and 2022 there were no trade and other receivables past due 11 TRADE AND OTHER PAYABLES Trade payables Other payables Accrued charges Total 2023 £’000 12 114 68 194 2022 £’000 50 21 54 125 The fair value of trade and other payables is considered by the Directors not to be materially different to carrying amounts. 12 CONVERTIBLE UNSECURED LOAN NOTES The outstanding convertible loan notes are zero coupon, unsecured and unless previously purchased or converted they are redeemable at their principal amount at any time on or after 31 December 2014. The net proceeds from the issue of the loan notes have been split between the liability element and an equity component, representing the fair value of the embedded option to convert the liability into equity of the Company as follows: Liability component at beginning and end of period 2023 £’000 10 2022 £’000 10 44 Mineral & Financial Investments Limited NOTES TO THE FINANCIAL STATEMENTS for the year ended 30 June 2023 The Directors estimate the fair value of the liability component of the loan notes at 30 June 2023 to be approximately £10,000 (2022: £10,000) 13 DEFERRED TAX PROVISION As at 1 July Provision relating to unrealised gains on investments As at 30 June 14 EMPLOYEE SHARE SCHEMES SHARE OPTIONS 2023 £’000 93 26 119 2022 £’000 93  93 On 10 June 2022 the Company granted 2,350,000 options to directors, advisers and consultants, exercisable at 13.5p per share, representing a 15% premium to the closing mid-market price on 9 June 2022. The options vest in three tranches, one third on the date of grant, one third on the anniversary of the date of grant, and one third on the second anniversary of the date of grant. The options can be exercised at any time from the date of vesting for a period of 5 years whilst the recipient is employed or engaged by the Company. The fair value of the options granted during the year was determined using the Black-Scholes pricing model. The significant inputs to the model in respect of the options were as follows: Date of grant 10 June 2022 Share price at date of grant Exercise price per share No. of options Risk free rate Expected volatility Life of option Calculated fair value per share 11.75p 13.50p 2,350,000 1.0% 50% 5 years 4.6797p The share-based payment charge for the year was £52,000 (2022: £41,000). The share options movements and their weighted average exercise price are as follows: 2023 Weighted average exercise price 2022 Weighted average exercise price Number (pence) Number (pence) 2,350,000    2,350,000 13.50    330,000 2,350,000 (330,000)  13.50 2,350,000 7.50 13.50 7.50  13.50 Outstanding at 1 July Granted Exercised Lapsed Outstanding at 30 June 45 Mineral & Financial Investments Limited NOTES TO THE FINANCIAL STATEMENTS for the year ended 30 June 2023 14 EMPLOYEE SHARE SCHEMES (continued) RESTRICTED SHARE UNITS (“RSUs”) On 10 June 2022 the Company granted 1,150,000 RSUs to directors. The RSUs vest in three tranches, one third on the date of grant, one third on the anniversary of the date of grant, and one third on the second anniversary of the date of grant. They can be exercised at any time from the date of vesting for a period of 5 years whilst the recipient is employed or engaged by the Company, with a reference price of 11.75p being the closing mid-market price on 9 June 2022. The fair value of the RSUs granted during the year was determined to be the reference price of 11.75p per share, and the share-based payment charge for the year in respect of the RSUs was £84,000 (2022: £51,000). The RSU movements and their weighted average reference price are as follows: 2023 Weighted average Reference price 2022 Weighted average Reference price Number (pence) Number (pence) 1,150,000    1,150,000 11.75     1,150,000   11.75 1,150,000  11.75   11.75 Outstanding at 1 July Granted Exercised Lapsed Outstanding at 30 June 46 Mineral & Financial Investments Limited NOTES TO THE FINANCIAL STATEMENTS for the year ended 30 June 2023 15 SHARE CAPITAL Number of shares Nominal Value £’000 Share premium £’000 AUTHORISED At 30 June 2022 and 30 June 2023 Ordinary shares of 1p each Deferred shares of 24p each ISSUED AND FULLY PAID At 30 June 2022 Ordinary shares of 1p each Deferred shares of 24p each 160,000,000 35,000,000 35,465,395 11,435,062 Ordinary shares issued in year to 30 June 2023 1,440,476 At 30 June 2023 Ordinary shares of 1p each Deferred shares of 24p each 36,905,871 11,435,062 1,600 8,400 10,000 354 2,745 3,099 15 369 2,745 3,114 5,914 268 6,182 The ordinary shares carry no rights to fixed income but entitle the holders to participate in dividends and vote at Annual and General meetings of the Company. The restricted rights of the deferred shares are such that they have no economic value. 16 LOAN NOTE EQUITY RESERVE Equity component of convertible loan notes at 1 July Equity component of convertible loan notes at 30 June 17 RESERVE FOR EMPLOYEE SHARE SCHEMES Brought forward at 1 July Transfer to retained earnings on exercise of options Share based payment charge Carried forward at 30 June 2023 £’000 6 6 2023 £’000 92  136 228 2022 £’000 6 6 2022 £’000 23 (23) 92 92 47 Mineral & Financial Investments Limited NOTES TO THE FINANCIAL STATEMENTS for the year ended 30 June 2023 18 RISK MANAGEMENT OBJECTIVES AND POLICIES The Company is exposed to a variety of financial risks which result from both its operating and investing activities. The Company’s risk management is coordinated by the board of directors and focuses on actively securing the Company’s short to medium term cash flows by minimising the exposure to financial markets. MARKET PRICE RISK The Company’s exposure to market price risk mainly arises from potential movements in the fair value of its investments. The Company manages this price risk within its long-term investment strategy to manage a diversified exposure to the market. If each of the Company’s equity investments were to experience a rise or fall of 10% in their fair value, this would result in the Company’s net asset value and statement of comprehensive income increasing or decreasing by £893,000 (2022: £718,000). FOREIGN CURRENCY RISK The Group holds investments and cash balances denominated in foreign currencies and investments quoted on overseas exchanges; consequently, exposures to exchange rate fluctuations arise. The Group does not hedge its foreign currency exposure and its liabilities in foreign currencies are limited to the trade payables of Mineral & Financial Investments AG which are not material. The carrying amounts of the Group’s foreign currency denominated monetary assets at the reporting date are as follows: US Dollar Canadian Dollar Swiss franc Euro Australian Dollar 2023 £’000 5,740 3,142 201 115  2022 £’000 5,913 1,402 28  208 FOREIGN CURRENCY SENSITIVITY ANALYSIS The Group is mainly exposed to the US Dollar and the Canadian Dollar in respect of investments which are either denominated in or valued in terms of those currencies. The following table details the Group’s sensitivity to a 5 per cent increase and decrease in pounds sterling against the US Dollar, Canadian Dollar and Swiss franc. The Group’s exposure to the Australian Dollar and the Euro are not considered material. US Dollar Canadian Dollar Swiss franc Euro 5% increase in exchange rate against GBP 5% decrease in exchange rate against GBP 5% increase in exchange rate against GBP 5% decrease in exchange rate against GBP 5% increase in exchange rate against GBP 5% decrease in exchange rate against GBP 5% increase in exchange rate against GBP 5% decrease in exchange rate against GBP Australian Dollar 5% increase in exchange rate against GBP 5% decrease in exchange rate against GBP 2023 £’000 287 (287) 157 (157) 10 (10) 6 (6)   2022 £’000 296 (296) 70 (70) 1 (1)   10 (10) CREDIT RISK The Company's financial instruments, which are exposed to credit risk, are considered to be mainly cash and cash equivalents and the Company’s receivables are not material. The credit risk for cash and cash equivalents is not considered material since the counterparties are reputable banks. The Company's exposure to credit risk is limited to the carrying amount of the financial assets recognised at the balance sheet date, as summarised below: 48 Mineral & Financial Investments Limited NOTES TO THE FINANCIAL STATEMENTS for the year ended 30 June 2023 18 RISK MANAGEMENT OBJECTIVES AND POLICIES (continued) Cash and cash equivalents Other receivables 2023 £’000 796 10 806 2022 £’000 481 12 493 No impairment provision was required against other receivables which are not past due. LIQUIDITY RISK Liquidity risk is managed by means of ensuring sufficient cash and cash equivalents are held to meet the Company’s payment obligations arising from administrative expenses. CAPITAL RISK MANAGEMENT The Company's objectives when managing capital are:    to safeguard the Company’s ability to continue as a going concern, so that it continues to provide returns and benefits for shareholders. to support the Company’s growth; and to provide capital for the purpose of strengthening the Company’s risk management capability. The Company actively and regularly reviews and manages its capital structure to ensure an optimal capital structure and equity holder returns, taking into consideration the future capital requirements of the Company and capital efficiency, prevailing and projected profitability, projected operating cash flows, projected capital expenditures, and projected strategic investment opportunities. Management regards total equity as capital and reserves, for capital management purposes. 19 FINANCIAL INSTRUMENTS FINANCIAL ASSETS BY CATEGORY The IFRS 9 categories of financial assets included in the balance sheet and the headings in which they are included are as follows: Financial assets: Cash and cash equivalents Loans and receivables Investments held at fair value through profit and loss 2023 £’000 796 10 8,925 9,731 2022 £’000 481 12 7,183 7,676 FINANCIAL LIABILITIES BY CATEGORY The IFRS 9 categories of financial liability included in the balance sheet and the headings in which they are included are as follows: Financial liabilities at amortised cost: Convertible unsecured loan notes Trade and other payables 2023 £’000 10 126 136 2022 £’000 10 71 81 49 Mineral & Financial Investments Limited NOTES TO THE FINANCIAL STATEMENTS for the year ended 30 June 2023 20 CONTINGENT LIABILITIES AND CAPITAL COMMITMENTS There were no contingent liabilities or capital commitments at 30 June 2023 or 30 June 2022. 21 POST YEAR END EVENTS Details of post year end events are set out in the Directors Report 22 RELATED PARTY TRANSACTIONS Key management personnel, as defined by IAS 24 ‘Related Party Disclosures’ have been identified as the Board of Directors, as the controls operated by the Group ensure that all key decisions are reserved for the Board of Directors. Details of the directors’ remuneration and the options and RSUs granted to directors are disclosed in the remuneration report. 23 ULTIMATE CONTROLLING PARTY The Directors do not consider there to be a single ultimate controlling party. 

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