XLON:TERA ESEF Annual Report

NEOTERRA GROUP PLC (XLON:TERA)

ESEF Annual Report 2025-11-18 For: 2025-06-30

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Added on September 19, 2026

CORPORATE INFORMATION	3

CHAIRMAN'S STATEMENT	4

CEO'S STATEMENT	5

OPERATIONS REVIEW	6

GROUP STRATEGIC REPORT	10

CORPORATE GOVERNANCE REPORT	17

DIRECTORS' REPORT	33

STATEMENT OF DIRECTORS' RESPONSIBILITIES	35

REMUNERATION REPORT	37

INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF ALTONA RARE EARTHS PLC	44

STATEMENT OF CONSOLIDATED PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME	52

STATEMENT OF CONSOLIDATED FINANCIAL POSITION	53

PARENT COMPANY STATEMENT OF FINANCIAL POSITION	54

STATEMENT OF CONSOLIDATED CASH FLOWS	55

PARENT COMPANY STATEMENT OF CASH FLOWS	56

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY	57

PARENT COMPANY STATEMENT OF CHANGES IN EQUITY	58

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS	59

DIRECTORS	Simon Charles - (Non-Executive Director) Cédric Simonet - (Director - Chief Executive Officer) Louise Adrian - (Director – Chief Financial Officer) Kristoffer Andersson – (Non-Executive Director)

COMPANY SECRETARY	Orana Corporate LLP

REGISTERED OFFICE	Eccleston Yards 25 Eccleston Place London SW1W 9NF

INDEPENDENT AUDITOR	PKF Littlejohn LLP 15 Westferry Circus London E14 4HD

CORPORATE ADVISOR	Strand Hanson 26 Mount Row London W1K 3SQ

BROKERS	Zeus Capital Limited 82 King Street Manchester M2 4WQ

BANKERS	HSBC Bank Plc 39 Tottenham Court Road London W1T 2AR

LAWYERS	Mildwaters Consulting LLP Walton House 25 Bilton Road, Rugby Warwickshire CV22 7AG

REGISTRARS	Share Registrars Limited 3 the Millennium Centre Crosby way, Farnham Surrey GU9 7XX

	2025	2024
Cash and cash equivalents	£109,000	£392,000
Administrative expenses as a percentage of total assets	39%	42%
Exploration costs capitalised during the year	£164,000	£250,000

	Production of a Pre-Feasibility Study and a Bankable Feasibility Study (“BFS”)
	Adhering to strict ESG standards– as determined by the jurisdiction and nature of the mining project
	Securing off-take partners ahead of commencement of mining
	Securing mine finance ahead of commencement of mining

Description		Impact		Mitigation
Strategic risks
•	Over reliance on the outcome of a single asset and the continuing value of said asset that may not result in a commercial development and there is no certainty of success. Successful acquisition of future opportunities to build shareholder value,	High	•	The Company is focused on acquiring majority stakes in a number of mining assets in different African countries with regards to the exploration, development and extraction of rare earth metals.
•	the generation of future income streams or net asset growth may not materialise. Competitors with significantly greater financial and technical resources will be able to outbid the Company on future upstream opportunities.		•	The Company also seeks to mitigate the development risk through actively diversifying its portfolio, which was achieved through the acquisition of a copper licence in Botswana and the commencement of a drilling program
•	The Company is dependent on key executives. The future success of the Company depends partially on the expertise of the CEO, as the Company's leading geologist. The loss of his services could damage the Company's business.		•	for fluorspar and gallium at Monte Muambe. The Company has a strong shareholder base, with 2 significant shareholders supporting the company through equity and debt.
•	Risk to strategic and business model due to political instability, expropriation, and government interference, especially when operating in one country only.		•	The CEO has a notice period of no less than three months to ensure efficient time to hand over responsibilities in the event of a departure. The Remuneration Committee regularly evaluates compensation and incentivisation schemes to ensure that the Company's package is competitive. The Company is looking to put a share option plan in place to reward executive directors for increasing shareholder value.
			•	The Board analyses the risks and rewards of a country before any

				investment is made and also engages with local partners who understand the local political risk. The Company's expansion into Botswana, is seen as mitigating some Country and Political risk as Botswana is viewed as stable for mining opportunities.
Financial risks
•	Difficulty raising external funding for new investment opportunities and exploration activities in volatile capital markets. The future availability of such financing is uncertain.	High	•	Regular review of cashflow, working capital and funding options are performed by the Board to ensure the Company remains a Going Concern.
•	Cost escalation and budget overruns may lead to faster use of cash resources than originally planned.		•	Build strong and sustainable relationships with key shareholders. Experienced advisers have been hired to ensure the capital market is accessible to the
•	Risk of high inflation, transfer and			Company.
	conversion of currency, which could significantly increase exploration and development costs and so affect valuation of future acquisitions.		•	Prudent approach to budgeting and strong financial stewardship - managing commitments and liquidity to ensure the Group has sufficient capital to meet spending commitments.
			•	Establish local bank accounts and negotiate contracts in US dollar value where practicable.
			•	Enter negotiations with a Strategic Investor to ensure reliability of funding for the completion of the PFS at Monte Muambe.
Environmental, social and governance risks
•	ESG is key to the company's legal and social license to operate. Non-compliances, or ESG-related social issues may prevent the development or operation of the Company's Projects.	Medium	•	ESG is part of the Company's longer- term, more strategic view and the Board will consider ESG at each board meeting and understand how their decisions will meet the various
•	ESG reporting is constantly evolving and is a risk for the majority of exploration and development companies. The Company must seek to improve diversity, equity and inclusion as well as be aware of the urgent priorities to address climate change. All stakeholders have increased expectations of the Company's ESG reporting		•	stakeholder demands. Policies and processes are being further enhanced to ensure there is a more rigorous reporting cycle in which requirements are identified and met before giving rise to any issues.
	and the Company must meet these demands.		•	The Company seeks to employ local
•	Human resources and management are critical to the success of the Company as it develops its operations in Africa and lack of quality personnel available could lead to			personnel where possible and has joined with local educational establishments to ensure training is of a high level.

	issues in completing projects in a timely and cost efficient manner.
Legal and compliance risks
•	Compliance with local laws and regulations.	Medium	•	The CEO has over 20 years' experience
•	Difficulties in obtaining approvals and licences in connection with new and existing assets.			working on mineral and energy projects in Africa, including 10 in Mozambique.
•	Bribery and corruption.		•	The Company also ensures local legal
•	London Stock Exchange or the Financial Conduct Authority Rule breaches			advice is obtained when new assets are to be purchased and these professionals are retained to ensure regular compliance is adhered to.
			•	The Company follows the updated 2023 QCA code of corporate governance and this is set out in this annual report and accounts. The Company also has the various policies in place which are overseen by the Audit Committee and reviewed on a regular basis:
				o Anti Bribery and Corruption Policy
				o Whistle Blowing Policy
				o Anti Money Laundering Policy
			•	The Board contains Directors with professional qualifications in law and accounting. It is also able to consult with outside advisers to ensure full compliance.

1.	Establish a purpose, strategy and business model which promote long-term value for shareholders;
2.	Promote a corporate culture that is based on ethical values and behaviours;
3.	Seek to understand and meet shareholder needs and expectations;
4.	Take into account wider stakeholder interest, including social and environmental responsibilities and their implications for long term success;
5.	Embed effective risk management, internal controls and assurance activities, considering both opportunities and threats, throughout the organisation;
6.	Establish and maintain the board as a well-functioning, balanced team led by the chair;
7.	Maintain appropriate governance structures and ensure that individually and collectively the directors have the necessary up-to-date experience, skills and capabilities;
8.	Evaluate board performance based on clear and relevant objectives, seeking continuous improvement;
9.	Establish a remuneration policy which is supportive of long-term value creation and the company’s purpose, strategy and culture; and
10.	Communicate how the Group is governed and is performing by maintaining a dialogue with shareholders and other relevant stakeholders.

Director	Independent	Board	Audit	Remuneration	Compliance
Cédric Simonet	NO	11	-	-	-
Louise Adrian	NO	11	2	-	1
Simon Charles	YES	11	2	1	1
Kristoffer Andersson*	NO	10	2	1	1

Significant issue	Summary of significant issue	Actions and conclusion
Valuation of Exploration and Evaluation assets	The carrying value of intangible assets related to exploration and evaluation assets amounted to £1.6m as at 30 June 2025 and as such, is material. The value of these assets is dependent on the successful development of the areas of mineral interest and production of the mineral. The exploration and evaluation assets recognised are in respect of the Monte Muambe Licence. Management is required to assess by reference to IFRS 6 Exploration and Evaluation Assets, whether there are potential indicators of impairment of the Group’s	The Company has a legal right to explore the licence at Monte Muambe and have been granted a 25 year mining licence subject to the agreement and payment of the financial guarantee. Management prepared an assessment of impairment indicators and considered whether there are any of the indicators of impairment in line with the criteria set out in IFRS 6. This did not highlight any impairment indicators and as such an IAS 36 impairment assessment was not required.

	exploration and evaluation assets at each reporting date and, if potential indicators of impairment are identified, management are required to perform a full assessment of the recoverable value of the exploration and evaluation assets in accordance with IAS 36 Impairment of Assets. Given the inherent judgement involved in the assessment of whether there are indications of impairment in exploration and evaluation assets, as required by IFRS 6, there is a risk the carrying amount of exploration and evaluation assets are overstated and should be impaired.
Valuation of Investments in subsidiaries and recoverability of intercompany receivables (Company)	The parent company holds material investments as at 30 June 2025 of £2.2m (2024: £2.1m), which is made up of both direct (funding for exploration activities) and indirect (acquisition of additional equity) investment in its subsidiaries. Given that Monte Muambe Mining, LDA (“MMM”) with reference to the underlying flagship project “Monte Muambe” is loss making and the other subsidiaries are either insubstantial or dormant, there is a risk that the investment in subsidiaries and intra group receivables, where intangible assets under development are the main assets of the subsidiaries, may not be fully recoverable.	The exploration programme at MMM has entered Phase 3 and the Company own 51% of MMM. The MRE and Scoping Study, published in the second half of 2023, both indicate the value of the MMM asset to be far more significant than either its current carrying value or intragroup balance. The drilling for Fluorspar commenced in September 2025, with a MRE and PFS expected for both fluorspar and gallium expected in early 2026. The Directors concluded that the investment and intragroup balances are expected to be fully recoverable. See also the impairment assessment noted above.
Going concern	Assessment of the Groups’ ability to continue as a going concern as part of the preparation of the financial statements. This includes considering whether the Group has adequate resources to continue in operation for the foreseeable future from the date of anticipated signing of the financial statements. The		In August 2025, the Company raised new equity funds of £0.9m and in October 2025 it raised a further £0.6m. The latter being used to repay a £0.6m debt facility These funds are expected to provide the Group with enough working capital to fund it through to Q1 in 2026. As a result, the Group will need to raise funding to provide additional working capital within the next 6 months. The ability of

	assessment of going concern covers a period of at least 12 months from the date of signing the financial statements.	the Group to meet its projected expenditure is dependent on these further equity injections and/or the raising of cash through bank loans or other debt instruments/government grants or exercise of warrants. These conditions necessarily indicate that a material uncertainty exists that may cast significant doubt over the Group’s ability to continue as a going concern and therefore their ability to realise their assets and discharge their liabilities in the normal course of business. Whilst acknowledging this material uncertainty, the Directors remain confident of raising finance, through one of the means stated above, and therefore, the Directors consider it appropriate to prepare the consolidated financial statements on a going concern basis.
Carrying value and recoverability of VAT debtor	The group has a material VAT receivable balance as at 30 June 2025. This is a long standing receivable and therefore there is a risk that the balance is no longer receivable and therefore overstated in the financial statements.	Management has engaged local tax specialists who have confirmed the high likelihood of recoverability of the majority of this balance. Therefore, the Directors have confident that the majority of this balance is not impaired and have provided against 26% of the total.

Environmental	Minimise our footprint and strive to be a leader in environmental sustainability by bringing critical minerals to the world in a manner that minimises or eliminates environmental impacts.
Social	Protect our workers through good health and safety and develop our people through training, inclusion and retention. Hiring and training local people were possible.
Governance	Application of sound corporate governance as set out on pages 17 to 32 of this report.

*Governance*	Management of climate-related risks and opportunities
Board’s oversight	The Company does not currently have a climate risk committee although climate risk is discussed at board meetings when relevant. A climate risk committee will be implemented when deemed necessary, most likely once a development project reaches DFS stage, prior to financing and implementation. Since our purpose, strategy and business plan are to capitalise on climate change by providing the materials the world needs to reduce its impact, we understand that climate change opportunity is embedded in our activity and that we need to ensure that the raw materials we produce or will produce are delivered in the least damaging way.
Assessment and management	The Board have started to consider the carbon footprint of its future products at MM and ways to reduce it. This is conceptual at this stage, but it is important to start early in order to integrate low

	emissions and climate change reduction options in all relevant parts of the project (energy mix, procurement, carbon credits). MM will engage environmental consultants as part of regulatory compliance for its operations: EMPs, environmental audits, EIAs. It engaged a consultant to do a Fatal Flaw Analysis as part of the Scoping Study.
*Strategy*	Approach to both the actual and potential impacts of climate-related risks and opportunities
Risks and opportunities	Climate related issues identified and discussed include: Opportunities (mostly medium-long term) 1. Producing critical minerals to enable the world’s energy transition. 2. Supplying products that can satisfy Responsible Sourcing demand (including certification and auditing). 3. Net zero objective (ambitious). Risks (some are short term) 1. Competition with China, which is aggressively acquiring raw material sources in Africa. 2. Non-Climate Change environmental and social impact that also need to be mitigated. 3. Availability of a suitable downstream supply chain to ensure the project’s sustainability including on Climate Change matters.
Strategy	Climate Change actions are integrated in studies from an early stage.
*Risk Management*	How the Group identifies, assesses and manages climate-related risks
Risk identification	The Company has identified key climate change related risks as follows: 1. Competition for minerals projects. 2. Competition for equity capital. 3. Climate change physical impacts on jurisdiction and regions where metals and minerals deposits are located. 4. Potential for higher input costs, notably for fossil fuels and building materials such as cement and steel. 5. Reduced demand for metal concentrates which have been produced using higher than average GHG emissions energy such as coal fired power. 6. Non Climate Change environmental risks.
Processes and management	The Company’s strategy is to acquire and develop critical minerals mining projects which will enable the world’s transition to renewable energy. A key part of the mine development process is the Pre-Feasibility Study (PFS), which includes investigations into mine emissions (gases and fluids) and waste (including tailings). The PFS also includes:

-	Fuel consumption (journey distance in miles for international air travel, domestic air and land travel);

-	Energy use at the camp in Mozambique can be calculated on a daily basis for when the camp is in operation, based on fuel and cooking gas consumption. Much of the energy used is already generated by solar which has zero GHG emissions. The operations here employed an average of 5 people (2024: 8 people), sharing accommodation and using one vehicle; and

-	Other significant GHG emissions related to the use of one 4wd vehicle operating for a combined period of 1,000 hours and transportation of raw material samples to South Africa, Zimbabwe and Australia for assays, mineralogy characterisation and metallurgical test work (2024: 184 hours of drilling activity and transportation of raw materials to Australia for assay).

	Number of Ordinary shares	Percentage of holding

Tracarta Ltd	31,575,000	10.82%
RS & CA Jennings	45,559,630	15.61%
Spreadex Limited	20,050,000	6.87%

	During 2024/5, due to the continued focus on cashflow management, the Company responded by agreeing with its Executive and Non-Executive Directors, with effect from 1 January 2025, that 25% of their salary/remuneration would be paid in Ordinary Shares in the Company, reducing the Company’s monthly cash salary costs.
	The CFO has agreed to continue to take her net salary in shares. This part of the salary will be paid by the issue of ordinary shares of the Company quarterly in arrears priced at the 10-day VWAP immediately prior to the end of the relevant quarter (being August, November, February and May) and will continue until economic conditions allow the full salary to be paid in cash.

		Base salary;
		Performance-related annual bonus scheme; and
		Long-term incentive plan (“LTIP’’).

	1. Investigations into the use of new technologies (especially renewable sources of energy such as solar). 2. Environmental baseline studies. 3. Water supply studies, rainfall pattern change, and regional hydrogeology. 4. Climate and weather patterns including average monthly temperatures. The PFS is authored by independent technical experts and managed by senior management and board members. For new project acquisitions, the company’s due diligence processes include a desktop review which cover all the above potential risks and opportunities.
*Metrics and Targets*	Disclose the metrics and targets used to assess and manage relevant climate-related risks and opportunities
GHG metrics	The Company’s GHG emissions are currently low due to the nature of operations. During the period under review the main GHG emitters were: 1. International/domestic travel to and from site in Mozambique and Botswana and international travel for fund raising. 2. Employee / contractor accommodation and associated energy use. 3. Exploration drilling and associated logistics. As noted in the Company’s SECR disclosure below, energy usage was below 40,000 kWh and as a result complete Scope 1, 2 and 3 GHG data was not collected. During 2025/6 (or as operations increase) the Group will implement improved GHG data collection methodology at the Company and subsidiary levels although it expects GHG emissions and energy usage to remain relatively low.
Climate related physical risks	The Company’s exposure to physical risk relates to changes to the environment where its exploration operations are based. The Company is working to identify these physical risks and then will be able to provide metrics and targets to monitor this risk.

	select suitable accounting policies and then apply them consistently;
	make judgments and accounting estimates that are reasonable and prudent;
	state whether applicable UK adopted international accounting standards 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 Group and Company will continue in business.

•	The Financial Statements prepared in accordance with UK adopted international accounting standards and give a true and fair view of the assets, liabilities, financial position and loss of the Group and Company; and
•	the Annual Report and Financial Statements, including the Business review, includes a fair review of the development and performance of the business and the position of the Group and Company, together with a description of the principal risks and uncertainties that they face.

Executive Director	Appointment date	Service period	Other information
Cédric Simonet	30 May 2023	90 days notice in writing	Contract updated to replace COO contract, effective 9 June 2023. Annual salary £140,000 (effective 1 September 2024).
Louise Adrian	30 May 2023	90 days notice in writing	Effective 9 June 2023. Annual salary of £30,000 (effective 1 September 2024) to be satisfied quarterly in shares* (based on 2 days per week). Louise also is a Partner at Orana Corporate LLP who provide the Company with Company Secretarial and accounting services (see related parties note 20).

Non-Executive Director	Appointment date	Other information

Simon Charles	30 May 2023	Appointment of Chair, effective 11 August 2024, with a salary of £37,500.

Kristoffer Andersson	1 August 2024	Annual salary of £28,000.

		Year ended 30 June 2025	Year ended 30 June 2024	% Change in total salary from prior year
	Salary/Fees*	Total	Total
	£	£	£
Non-Executive Directors
Simon Charles	36,453	36,453	33,833	7.7%
Kristoffer Andersson¹	25,667	25,667	-	N/A
Audrey Mothupi²	2,000	2,000	24,000	N/A
Martin Wood³	6,613	6,613	60,000	N/A
Sub-total	70,733	70,733	117,833	(40.0%)
Executive Directors
Louise Adrian	29,000	29,000	24,000	20.8%
Cédric Simonet	136,667	136,667	120,000	13.9%
Sub-total	165,667	165,667	144,000	15.0%
Total	236,400	236,400	261,833	(9.7%)

	24 October 2025	30 June 2025	30 June 2024
Non-Executive Directors
Simon Charles	1,023,862	781,148	-
Kristoffer Andersson	314,994	133,766	-
Sub-total	1,338,856	914,914	-
Executive Directors
Louise Adrian	6,949,635	5,534,594	405,306
Cédric Simonet	4,975,670	3,398,986	925,711
Sub-total	11,925,305	8,933,580	1,331,017

Total	13,264,161	9,848,494	1,331,017

	Distributions to shareholders	Total directors and employee pay	Operational cash outflow
	£	£	£
Year ended 30 June 2025	Nil	316,000	966,000
Year ended 30 June 2024	Nil	490,000	98,000

	●	The financial statements give a true and fair view of the state of the company’s affairs as at 30 June 2025 and of the group’s loss for the year then ended;
	●	the group financial statements have been properly prepared in accordance with UK-adopted international accounting standards; and
	●	the parent company financial statements have been properly prepared in accordance with UK-adopted international accounting standards and as applied in accordance with the provisions of the Companies Act 2006; and
	●	the financial statements have been prepared in accordance with the requirements of the Companies Act 2006.

	●	Reviewing the cashflow forecast and budgets for the going concern period being twelve months from the anticipated date of signing the financial statements and the corresponding key assumptions and inputs used. This included inflows from capital fundraises that management anticipate being achieved in the going concern period;
	●	Discussing with management regarding the future plans of the group;
	●	Comparing actual results for the year to forecasts to assess management’s forecasting abilities and the accuracy of its forecasts;
	●	Challenging management’s key assumptions and inputs of forecast cash receipts from fundraising and cash outflows in respect of committed costs;
	●	Testing the arithmetical accuracy of the cashflow forecasts; and
	●	Performing a sensitivity analysis on the key assumptions and inputs within the forecasts.

	Group financial statements	Parent company financial statements
Materiality for the financial statements as a whole	£33,000 (2024: £55,000)	£25,000 (2024: £37,500)
Performance materiality	£26,000 (2024: £38,500)	£20,000 (2024: £26,250)
Basis for materiality for the financial statements as a whole	2% (2024: 5% of the group’s net assets) of the group’s adjusted net assets.	1.25% (2024: 3% of parent company’s net assets) of the parent company’s adjusted net assets.
Rationale	The group is still in the exploration stage and is not revenue generating. Adjusted net assets are therefore viewed as the key area of relevance to stakeholders in assessing the financial performance of the group in its early years of exploration, as the net asset value is driven by the exploration assets which will ultimately drive future profitability of the group. We have revised our materiality benchmark from net assets to adjusted net assets, with the adjustment reflecting the add-back of loan balances. This change is based on our assessment that adjusted net assets offer a more representative view of the group’s financial position, particularly as the group is not yet trading and has been primarily financed through equity fundraises and borrowings.

Key Audit Matter	How our scope addressed this matter
Valuation of Exploration and
Evaluation assets (note 2 and 11)
The group has material intangible	Our work in this area included:
assets of £1,637k, being capitalised	• Substantive testing on additions capitalised to
exploration costs in respect of	exploration and evaluation assets during the
exploration and evaluation activities	year to assess whether they are:
in Mozambique.	o appropriate to capitalise; and
	o are allocated to a valid legal right to
There is a risk that these assets have	explore which is owned by the group.
been incorrectly capitalised in	• Obtaining, reviewing and critically assessing
accordance with IFRS 6 Exploration for	management's impairment assessment and
and Evaluation of Mineral Resources	obtaining supporting evidence for
and that there could be indicators of	management's judgements therein;
impairment as at 30 June 2025.	• Assessing whether impairment indicators
Management's assessment of the IFRS	exist in line with IFRS 6, taking into account
6 indicators of impairment involves	the following factors:
judgement, particularly in early-stage	o The current status of Mining
exploration projects. There is a risk	Concession No. 11854C, including the
that the carrying value of these	conditions attached to its granting
intangible assets is overstated.	and its expiry date;
	o Correspondence with the National
Given the carrying value of the	Mining Institute (Instituto Nacional de
intangible assets is material and that	Minas, INAMI);
judgement is involved when assessing	o The status of outstanding matters
this balance for impairment, this area	that must be resolved prior to the
is considered to be a key audit	final issuance of the mining
matter.	concession, and the likelihood of their
	resolution.
	• Discussing with management their plans
	regarding future exploration on the licence
	areas; and
	• Assessing the appropriateness of the
	accounting policies and disclosures included
	in the financial statements in accordance with
	IFRS 6.

	Key observations
	We draw attention to the mining concession granted
	to the group on 20 December 2024 for rare earths
	and associated minerals (which includes fluorspar and
	gallium). The concession includes outstanding
	commitments at year end, notably the settlement of a
	financial guarantee that remains under negotiation.
	The negotiation follows a revised scoping document
	submitted by the group to the Government of
	Mozambique, which primarily focuses on Fluorspar.
	Management has indicated that development
	activities related to Rare Earths may also continue
	under this licence and associated guarantee. If the
	group is unable to reduce the guarantee, it may
	exceed available funding, potentially resulting in the
	concession being revoked.

Valuation of Investments in
subsidiaries and recoverability of
intercompany receivables (parent
company) (note 2 and 10)
The parent company holds material	Our work in this area included:
investments as at 30 June 2025 of	• Obtaining the impairment review for all
£346,000 (2024: £365,000).	investments held from management and
	challenging the key assumptions;
There is also a material intragroup	• Confirming the ownership of MMM,
loans of £1,835,000 (2024:	• Ensuring that no impairment indicators exist
£1,705,000) given the parent	in accordance with IFRS 6 and IAS 36
company funds exploration activity in	Impairment of Assets;
Mozambique.	• Challenging the judgements and estimates
	used by management to assess the
Since the underlying flagship project	recoverability of the investment including the
“Monte Muambe” is within the	reclassified intragroup loans; and
parent company's investment in	• Considering the recoverability of investments
MMM, there is a risk that the	and intragroup loans by comparing these to
investment in subsidiaries and intra	underlying asset values and exploration
group receivables are not fully	projects.
recoverable.
	Key observations
Given the carrying value is material	Since the investment balance substantially relates to
and that judgement is involved when	the group's flagship project, Monte Muambe, held
assessing	within the parent company's investment in MMM, we
impairment and expected credit	draw attention to the key observation above
losses, this area is considered to be a	regarding the valuation of exploration and evaluation
key audit matter.	assets. The uncertainties surrounding the mining
	concession and associated guarantee amount may
	have a direct impact on the recoverability of the
	investment in subsidiaries and intercompany
	receivables.

	●	the information given in the strategic report and the directors’ report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
	●	the strategic report and the directors’ report have been prepared in accordance with applicable legal requirements.

	●	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 and the part of the directors’ remuneration report to be audited 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.

●	We obtained an understanding of the group and parent company and the natural resources sector to identify laws and regulations that could reasonably be expected to have a direct effect on the financial statements. We obtained our understanding in this regard through detailed discussions with management about and potential instances of non-compliance with laws and regulations both in the UK and in Mozambique. We also selected a specific audit team based on experience with auditing listed entities of a similar size within this industry.
●	We determined the principal laws and regulations relevant to the group and parent company in this regard to be those arising from:
	o	Listing Rules and Disclosure Guidance and Transparency Rules listing rules
	o	2023 Quoted Companies Alliance code (QCA)
	o	Anti-Bribery and Money Laundering Regulations
	o	Local industry regulations in Mozambique
	o	Local tax laws in the UK and Mozambique
●	We designed our audit procedures to ensure the audit team considered whether there were any indications of non-compliance by the group and parent company with those laws and regulations. These procedures included, but were not limited to:
	o	Enquiries of management and discussions with the component auditor
	o	Review of board minutes
	o	Review of legal expenses
	o	Review of Regulatory News Services (RNS) announcements
●	We also identified the risks of material misstatement of the financial statements due to fraud. We considered, in addition to the non-rebuttable presumption of a risk of fraud arising from management override of controls, that the potential for management bias was identified in relation to the valuation of debt facilities and convertible loans, the valuation of share-based payments, the valuation of the investment in subsidiary undertakings and the valuation of exploration and evaluation assets as described in the Key Audit Matters section above. We addressed this by challenging the assumptions and judgements made by management when auditing these significant accounting estimates and ensuring that there were adequate disclosures included in the respective notes the financial statements.

	●	As in all of our audits, we addressed the risk of fraud arising from management override of controls by performing audit procedures which included but were not limited to: the testing of journals; reviewing accounting estimates for evidence of bias; and evaluating the business rationale of any significant transactions that are unusual or outside the normal course of business.
	●	Compliance with laws and regulations at the subsidiary level was ensured through conducting enquiries of management and reviewing correspondence for any instances of non-compliance.

Daniel Hutson (Senior Statutory Auditor)	15 Westferry Circus
For and on behalf of PKF Littlejohn LLP	Canary Wharf
Statutory Auditor	London E14 4HD


	Notes	2025 £’000	2024 £’000

Continuing operations:
Administrative expenses		(789)	(971)
Operating costs		(66)	(102)
Fundraise costs		-	(72)
Operating loss	5	(855)	(1,145)
Finance costs	8	(88)	(527)
Loss before taxation		(943)	(1,672)
Income tax	9	-	-
Loss for the year from continuing operations		(943)	(1,672)

Total loss for the year attributable to:
Owners of Altona Rare Earths Plc		(916)	(1,618)
Non-controlling interests		(27)	(54)
		(943)	(1,672)
Other comprehensive income
Items that may be reclassified subsequently to profit and loss:
Exchange differences on translation of foreign operations		(152)	15
		(152)	(1,657)
Total comprehensive loss attributable to:
Owners of Altona Rare Earths Plc		(1,074)	(1,606)
Non-controlling interests		(21)	(51)
		(1,095)	(1,657)

Earnings per share (expressed in pence per share)
- Total Basic and Diluted earnings per share	7	(0.59)p	(1.97)p

	Share capital	Share premium	Paid in share capital to be issued	Foreign exchange reserve	Share-based payment reserve	CLN Reserve	Retained deficit	NCI	Total equity
	£’000	£’000	£’000	£’000	£’000	£’000	£’000	£’000	£’000

Balance at 30 June 2023	2,239	22,950	-	17	121	12	(23,360)	(94)	1,885
Comprehensive income
Loss for the year	-	-	-	-	-	-	(1,618)	(54)	(1,672)
Currency translation	-	-	-	12	-	-	-	3	15
*Total comprehensive income*	-	-	-	12	-	-	*(1,618)*	*(51)*	*(1,657)*
Transactions with owners recognised directly in equity
Issue of shares	44	122	-	-	-	-	-	-	166
Shares to be issued	-	-	345	-	-	-	-	-	345
Share-based payments	-	-	-	-	353	-	-	-	353
Additional transactions with NCI	-	-	-	-	-	-	(119)	48	(71)
*Total transactions with owners recognised directly in equity*	44	*122*	*345*	-	*353*	-	*(119)*	48	*793*
Balance at 30 June 2024	2,283	23,072	345	29	474	12	(25,097)	(97)	1,021
Comprehensive income
Loss for the year							(916)	(27)	(943)
Currency translation	-	-	-	(159)	-	-	-	7	(152)
*Total comprehensive income*	-	-	-	(159)	-	-	(916)	(20)	(1,095)
Transactions with owners recognised directly in equity
Issue of shares	799	55	(345)	-	-	-	-	-	509
CLN issue	-	-	-	-	-	(12)	12	-	-
*Total transactions with owners recognised directly in equity*	*799*	55	*(345)*	-	-	*(12)*	12	-	*509*
Balance at 30 June 2025	3,082	23,127	-	*(130)*	*474*	-	*(26,001)*	*(117)*	435