Prospects You should read the following discussion and analysis of our financial condition and results of operations together with the historical audited annual consolidated financial statements and the related notes included elsewhere in this Annual Report. Some of the information contained in this discussion and analysis or set forth elsewhere in this Annual Report, including information with respect to our plans and strategy for our business and related financing, includes forward-looking statements that involve risks and uncertainties. As a result of many factors, including those factors set forth in the section entitled Item 3.D. “Risk Factors” of this Annual Report, our actual results could differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis. Overview of Business We are a mining exploration and evaluation company focused on critical metals and minerals and producing strategic products essential to electrification and next generation technologies for Europe and its Western world partners. Our main efforts are focused on the advancement of the Tanbreez Project which is located in southern Greenland of which we currently hold a 42% interest in. In addition, we are focused on the exploration and evaluation of the Wolfsberg Project located in Carinthia, Austria, which is approximately 270 kilometers south of Vienna. In addition, we also hold a 20% interest in the Weinebene and Eastern Alps Lithium Projects. Our Business Strategy Our primary strategy is to acquire, explore and develop unique and permitted critical metals mining assets that we expect will benefit from robust regulatory tailwinds in both Europe and North America and long-term secular trends for next generation technology in environmental, commercial and government applications. Our foundational assets are the Wolfsberg lithium assets in Austria and the Tanbreez rare earths deposit in Greenland. Our strategy involves developing a low cost, highly sustainable source of lithium hydroxide manufactured from spodumene concentrate, providing European battery and EV manufacturers improved continuity of supply, reducing their dependence on the battery supply from Chinese manufacturers, while also helping them meet their environmental commitments. In addition to the exploration and evaluation of the Wolfsberg Project, we expect to focus our efforts on rare earths and critical metals and minerals to produce strategic products essential for a transition to sustainable low carbon emission technologies for Europe and its western world partners. We believe this approach will allow us to become one of the most sustainable, cost-effective and strategic minerals suppliers in the world, and further help potential customers achieve their important environmental, social and governance goals required by shareholders and regulatory agencies. 62 As part of our business strategy, we intend to seek to acquire assets and operations that are strategic and complementary to our existing operations. This may include acquisitions or investments in complementary companies, assets, mines, products or technologies, including in other rare earth elements and minerals. We may have opportunities to make acquisitions from third parties jointly with EUR, and in some cases, we may acquire assets or other operations directly from EUR or its affiliates. EUR has no obligation to sell any additional assets to us or to accept any offer that we may make for any additional assets, and we may decide not to acquire such additional assets even if EUR or an affiliate offers them to us. We have in the past evaluated and pursued, and intend in the future to evaluate and pursue, rare earth-related assets and other critical metals assets that have characteristics and opportunities similar to our existing business lines and enable us to leverage our asset base, knowledge base and skill sets. Such acquisition efforts may involve participation by us in processes that have been made public and involve a number of potential buyers, commonly referred to as “auction” processes, as well as situations in which we believe we are the only party or one of a limited number of potential buyers in negotiations with the potential seller. These acquisition efforts often involve assets which, if acquired, could have a material effect on our financial condition and results of operations. We typically do not announce a transaction until after we have executed a definitive acquisition agreement. Discussions and negotiations regarding a potential acquisition can advance or terminate in a short period of time. Moreover, the closing of any transaction for which we have entered into a definitive acquisition agreement will be subject to customary and other closing conditions, which may not ultimately be satisfied or waived. Accordingly, we can give no assurance that our current or future acquisition efforts will be successful. Although we expect the acquisitions we make to be accretive in the long term, we can provide no assurance that our expectations will ultimately be realized. Recent Developments HoA Amendment On September 29, 2025, the Company entered into the HoA Amendment with Rimbal. The HoA Amendment amends the Heads of Agreement to, among other things, (i) remove the Company’s obligation to invest $10 million in Tanbreez to receive the Stage 2 Interest and (ii) upon approval from the Greenlandic Mineral Resources Authority of Rimbal’s transfer of Tanbreez to the Company, obligates the Company to issue 14,500,000 Ordinary Shares to Rimbal in exchange for the Stage 2 Interest. The transaction remains subject to Greenland governmental approval. Ucore Letter of Intent On August 26, 2025, we entered into a non-binding letter of intent with Ucore Rare Metals Inc. for a potential offtake agreement for up to 10,000 metric tons of rare earth concentrate from our Tanbreez Project, which represents approximately 10% of the Tanbreez Project’s initial projected production. U.S. Export-Import Bank Letter of Interest On June 16, 2025, the Company announced that it received a non-binding letter of interest from the U.S. Export-Import Bank. The letter of interest contemplates that U.S. Export-Import Bank could provide up to $120 million to be used by the Company to develop the Tanbreez Project. Factors that May Influence Future Results of Operations Our financial results of operations may not be comparable from period to period due to several factors. Key factors affecting our results of operations are summarized below. We are an exploration stage mining and development company focusing on the exploration and evaluation of our wholly-owned Wolfsberg Project located in Carinthia, Austria, which is approximately 270 kilometers south of Vienna. We have declared mineral resources on our Wolfsberg Project but we have not yet begun to extract any mineral from the property. The exploration and evaluation of the mineral deposits located at the Wolfsberg Project involves a high degree of financial risk and uncertainty. We have not commenced production in connection with the Wolfsberg Project and, consequently, we do not currently have any operating income or cash flows. Accordingly, we do not currently generate any revenues. As of June 30, 2025 and June 30, 2024, we have spent approximately $39.7 million and $35.2 million, respectively, in connection with our exploration and evaluation activities at the Wolfsberg Project. For the year ended June 30, 2025 and the fiscal year ended June 30, 2024 our cash expenditures were approximately $1.1 million and $1.1 million, respectively, in connection with our exploratory work and our evaluation of the Wolfsberg Project. As of June 30, 2025 and June 30, 2024 our investment in a joint venture in connection with the Tanbreez Project is $107.9 million and $5.0 million respectively. For the fiscal years ended June 30, 2025 and June 30, 2024 our cash expenditures were approximately $5.3 million and $5.0 million, respectively, in connection with our investment in the joint venture. We are an exploration stage mining and development company focusing on the exploration and evaluation of our recently acquired, and permitted, foundational asset, the Tanbreez Project, located in Southern Greenland, which is approximately 3km west of Narsaq, the Provincial Capital. The regional capital, Qaqortoq, is 20 km to the south and the regional airport of Narsarsuaq is being moved to approximately 12 km south of the license. We have not declared mineral resources on the Tanbreez Project, nor have we begun to extract any minerals from the property. The exploration and evaluation of the mineral deposits located at the Tanbreez Project involves a high degree of financial risk and uncertainty. We have not commenced production in connection with the Tanbreez Project and, consequently, we do not currently have any operating income or cash flows. Accordingly, we do not currently generate any revenues. 63 Timing of Current Projects and Future Geographic and Product Expansion Our financial results and liquidity needs vary from quarter-to-quarter or year-to-year depending on the timing of: ● the engagement of our key consultants and suppliers; ● the completion of the DFS at the Wolfsberg Project focusing specifically on the mining mine/concentrator operations only, which is expected to occur 8-10 months after finance availability, approximately in 2025; ● obtaining and renewing the applicable permits with the relevant mining authorities in Austria and Greenland; ● obtaining project financing and/or other sources of capital for the exploration and evaluation of the Wolfsberg Project in Austria and the Tanbreez Project in Greenland; ● the future development and construction of mine and plant at the Wolfsberg Project; ● the commencement of production at the Wolfsberg Project, which is expected to occur in 2028 or 2029, subject to the results of the completed DFS; ● completion of the exploration and drilling program for the Project Tanbreez in Greenland; ● completion of the geological, geochemical, engineering studies, Environmental Impact assessment and Socio -Economic Studies for Project Tanbreez in Greenland; ● conduct the work required to prepare the definitive feasibility study for the Tanbreez Project, which is expected to occur by the end of 2025; ● Satisfaction of the Greenland government’s extension of certain deadlines under the Exploitation license of the Tanbreez Project (License No. 2020-54) 2028, such as (i) submission of an exploitation and closure plans to the Greenland government by the end of 2025, (ii) providing financial security and a company guarantee by June 30, 2026, and (iii) commencing the exploitation of minerals by the end of 2028; and ● the future development and construction of the mine and processing facilities at the Tanbreez Project in Greenland. Additionally, we expect both our capital and operating expenditures will increase significantly in connection with our ongoing activities, as we: ● hire additional personnel; ● continue to work on the completion of the DFS for the Wolfsberg Project; ● conduct geological, geochemical, engineering studies, Environmental Impact assessment and Socio -Economic Studies for Project Tanbreez in Greenland; ● conduct the work required to prepare the Regulation SK-1300 report for the Tanbreez Project; ● commence exploration activities in Zone 2 of the Wolfsberg Project; ● commence exploration activities at the Tanbreez Project; ● enter into financing and project financing arrangements in connection with the further exploration and any future development of the Wolfsberg Project and Tanbreez Project; and ● operate as a public company on the Nasdaq. Please read “— Liquidity, Capital Commitments and Resources.” 64 Industry Growth Our financial profile is associated with several secular trends in the mining industry. Demand for our product is, in part, driven by the growth of our underlying end markets and how much capital our customers invest to support their businesses. We are also impacted by the global supply and demand for lithium, rare earths and critical minerals and metals products. Our ability to generate revenue is sensitive to rapidly changing consumer preferences and industry trends, as well as the popularity of consumer products using lithium products, such as electronic vehicles. In December 2022, we entered a long-term Offtake Agreement with BMW, pursuant to which BMW will purchase battery grade lithium hydroxide produced by the Wolfsberg Project. Please see the section entitled “Information about the Company — Offtake Agreement with BMW AG” for more details on the Offtake Agreement. We believe that we are well-positioned at the intersection of key long-term macro trends however, changes in inflationary pressures, commodity prices, energy costs, changes in legislative environment or global industry trends could result in significant fluctuations towards the path of production. Market and Economic Conditions Our business depends on the economic extraction of lithium from the Wolfsberg Project and other critical metals and minerals from our other projects, including the Tanbreez Project, and the sales products to our offtake partners. Many factors related to the economic extraction of lithium, including economic conditions affecting disposable consumer income and ultimate demand for consumer items that rely on the production of lithium products, unemployment levels, fuel prices, interest rates, inflationary pressures, changes in tax rates and tax laws that impact companies or individuals and inflation, can impact our operating results. Seasonality The Wolfsberg Project is located in Wolfsberg, Austria. While the seasonal impact is minimal, the timing for the execution of some exploration activities is impacted as a result of the winter conditions experienced in that region. The Tanbreez Project is located in Southern Greenland. Greenland is often considered “ground zero” for the climate crisis because even small shifts in temperature can have outsize impacts across the entire Arctic region. Logistics, exploration and future mining activities could be largely impacted by severe weather conditions, including but not limited to storms, sea ice movements etc. At a regional scale the weather in South Greenland is mainly influenced by the North American continent and the North Atlantic Ocean. But the local climate is also heavily influenced by the Greenland Inland Ice. Another key factor is the all year round low sea surface temperature which is causing the South Greenland waters and coasts to be part of the arctic zone with summer temperatures below 10 degree C. Further inland, the weather type is more of a continental type and in South Greenland average summer temperatures can locally exceed the 10 degree threshold, which limit the arctic region. Gale force winds (above 13.8 m/s) are common in South Greenland in particular in winter. Sea ice, originating from glaciers, sometimes enters the fjords and could also have an impact on the operations. Impact of Inflation Global uncertainties, such as the wars in the Ukraine and Middle East, have led to problems in global supply chains which caused supply bottlenecks in many sectors of the economy. The principal factors contributing to the inflationary pressures that have been experienced or will be experienced include but are not limited to Europe’s supply chain for critical materials, such as energy (gas and electricity) and reagents. We may continue to experience inflationary pressures in the future, particularly after the Wolfsberg Project has commenced production. In order to combat inflation before the Wolfsberg Project begins producing, we may take certain actions such as monitoring operating expenses, limiting headcount, and implementing other measures we deem beneficial to minimize inflationary pressures and avoid unnecessary costs. Risks Associated with Future Results of Operations For additional information on the risks associated with future results of operations, please see “Risk Factors — Risks Relating to the Company” including, but not limited to “— Risks Related to our Business and our Industry” and “— Operating Risks.” 65 Presentation of Financial Information Our reviewed audited financial statements for the year ended June 30, 2025 and our audited financial statements for the year ended June 30, 2024 were prepared in accordance with IFRS. Statement of Financial Position Financial Position as of June 30, 2025, and June 30, 2024 The following table summarizes our consolidated statement of financial position as of June 30, 2025 and 2024. All amounts are shown in U.S. dollars. June 30, 2025 $ June 30, 2024 $ ASSETS Current Assets Cash and cash equivalents 7,297,328 1,259,242 Other receivables 47,894 837,930 Prepaid expenses 962,902 1,645,180 Total Current Assets 8,308,124 3,742,352 Non-Current Assets Restricted cash 15,470,178 15,020,679 Property and plant and equipment 2,016 853 Deferred exploration and evaluation expenditure 39,712,591 35,213,542 Investment in equity accounted joint venture 107,856,418 5,000,000 Investment in equity-accounted associate 350,068 343,239 Right of use asset 22,865 30,871 Total Non-Current Assets 163,414,136 55,609,184 TOTAL ASSETS 171,722,260 59,351,536 LIABILITIES Current Liabilities Trade and other payables 17,971,783 13,226,525 Provisions 27,454 24,200 Lease liability 11,870 9,842 Funding from related party 5,854,852 4,268,857 Warrants liability 40,919,123 37,864,064 Total Current Liabilities 64,785,082 55,393,488 Non-Current Liabilities Offtake prepayment 15,000,000 15,000,000 Lease liability 14,208 23,796 Total Non-Current Liabilities 15,014,208 15,023,796 TOTAL LIABILITIES 79,799,290 70,417,284 NET ASSETS 91,922,970 (11,065,748 ) EQUITY Share capital 197,732,356 51,508,320 Unissued Capital 45,734,183 45,734,183 Reserves 49,013,687 40,377,182 Accumulated deficit (200,557,256 ) (148,685,433 ) TOTAL EQUITY 91,922,970 (11,065,748 ) 66 Assets Total assets as of June 30, 2025, and June 30, 2024 were $171.7 million and $59.3 million, respectively, comprised primarily of investment in joint venture ($107.9 million), exploration and evaluation in the Wolfsberg Project ($39.7 million), advance payment from BMW received under the off-take agreement ($15.5 million). Please see the section entitled “Description of the Tanbreez Project” for a complete description of the Tanbreez Project and “Description of the Wolfsberg Project” for a complete description of the Wolfsberg Project. Liabilities Total liabilities as of June 30, 2025 and June 30, 2024 were $79.8 million and $70.4 million, respectively, primarily from the Company’s warrant liabilities ($40.9 million). Bank guarantee secured against the advance payment from BMW $15.0 million and trade payables arising from the ordinary course of business and costs associated with the Business Combination ($17.7 million). Equity Total equity as of June 30, 2025 and June 30, 2024 were $91.9 million and ($11.1 million), respectively, primarily from the issue of securities by the Company, foreign currency translation reserve arising on translation from functional currency to presentation currency and retained earnings (results of the operations). A. Components of Our Results of Operations Other income Our other income includes grants received for European Union projects which ECM Lithium is participating in and interest on BMW funds on deposit. Foreign exchange Foreign exchange expenses include exchange differences on translation of foreign operations include the differences between the currency of the primary economic environment in which we operate and the currency presented in our financial statements in accordance with our accounting policy. See note 2 to our interim period unaudited consolidated financial statements and audited consolidated financial statements included elsewhere in this annual report for a description of the Company’s foreign currency accounting policy. Consultants and professional services expenses Our consultants and professional services expenses include legal fees, investor relations consultants, taxation advisors and company secretarial advisors’ expenses incurred since the completion of the Business Combination. See note 4 to consolidated financial statements included elsewhere in this annual report for a description and breakdown of our consultants and professional services expenses. 67 Travel and entertainment Our travel and entertainment expenses relate to travel and entertainment expenses incurred by the Company’s management and directors in the performance of their duties on behalf of the Company. Share based compensation Our share-based compensation relates to the expense of the current period attributable to the Company’s share grants to its directors, executives and senior management. Directors’ fees Our directors’ fees include compensation to the members of the newly constituted board of directors of the Company. Compliance and regulatory fees Our compliance and regulatory fees relate primarily to the annual listing fee paid to the Nasdaq, the Company’s PCAOB audits and costs related to filing public reports and forms with the SEC. Administrative expenses Our administrative expenses include membership and subscriptions, seminars and conferences and IT support. Promotion, IR and PR expenses Our administrative expenses include promotional expenses, and payments made to the Company’s investor relations and PR consultants and or incurred by the Company related to such activities. Insurance Our insurance represents expense primarily related to the director and officers (D&O) insurance program put in place by the Company for its Board of Directors and executives. Finance costs Finance costs include impact of the initial recognition of the Company’s warrant liabilities, fees arising from the Company’s agreement with GEM, as well other bank fees, interest expense, interest expense on leased assets and other finance costs. See note 4 to our consolidated financial statements included elsewhere in this annual report for a description and detailed breakdown of our finance costs. Depreciation expenses Depreciation expenses are primarily attributed to office equipment. See note 10 to our consolidated financial statements and audited consolidated financial statements included elsewhere in this annual report for a description of our depreciation expenses. Depreciation expenses — leased asset Depreciation expenses — leased asset relates to the lease of a vehicle at the Wolfsberg Project. Merger expenses Merger expenses relate to expenses associated with the Business Combination. See note 4 to our consolidated financial statements included elsewhere in this annual report for a description of our merger expenses. 68 Listing Expenses Our listing expenses (“Listing Expenses”) in the prior year related to the costs of Company’s listing on Nasdaq primarily in the form of the excess of the fair value of the shares issued at the completion of the Business Combination over the book values of the net assets of Sizzle, as wells as excess of the fair value of Company’s shares issued in settlement of the Company’s liabilities incurred in the process of closing of the Business Combination. See note 4 to our consolidated financial statements included elsewhere in this annual report for a description and details of our listing expenses. Exploration expenditure expensed Our exploration expenditures expenses represent costs incurred in for the geological due diligence for the Company’s projects. Loss on fair value of warrants Our loss on fair value of warrants includes changes in the fair value of the Company’s liability for the warrants issued to investors and wells as gain arising upon exercise of a portion of such warrants. Other expenses Other expenses consist of smaller expenses not categorized elsewhere and local taxes. B. Results of Operations Comparison of Years ended June 30, 2025, 2024 and 2023 The following table summarizes our consolidated results of operations for the fiscal year ended June 30, 2025, 2024 and 2023. All amounts are shown in U.S. dollars. June 30, 2025 $ June 30, 2024 $ June 30, 2023 $ Continuing operations Other income 560,623 117,660 111,218 Foreign exchange (loss)/gain (1,183,315 ) 41,715 (2,200 ) Consultants and professional services expenses (12,338,201 ) (1,383,645 ) (310,737 ) Travel and entertainment (275,623 ) (47,701 ) (22,395 ) Directors’ fees (1,391,263 ) (136,901 ) - Share based payments to directors and management (30,566,894 ) (608,156 ) - Compliance and regulatory fees (746,676 ) (426,325 ) - Administration expenses 64,009 (14,933 ) (35,653 ) Promotion, IR and PR expenses (1,192,471 ) (191,403 ) (63,881 ) Insurance (2,073,232 ) (773,820 ) - Finance costs (466,099 ) (29,828,866 ) (14,871 ) Depreciation expense (1,088 ) (6,642 ) (6,757 ) Depreciation expense – leased assets (10,161 ) (19,359 ) - Share of profit/(loss) of equity accounted associate, net of tax 6,829 (2,263 ) - Loss on disposal of fixed asset (945 ) - - Merger expenses (3,000,000 ) (9,373,737 ) (5,104,937 ) Listing expenses - (76,007,159 ) - Gain on extinguishment of liability 235,350 - - Exploration expenditure expensed (238,309 ) (159,685 ) - Gain/(loss) on fair value of warrants 49,534 (20,623,381 ) - Share of profit of equity accounted joint venture, net of tax 701,978 - - Other expenses (5,869 ) (1,603 ) - Loss before income tax (51,871,823 ) (139,446,204 ) (5,450,213 ) Income tax expense - - - Loss after tax (51,871,823 ) (139,446,204 ) (5,450,213 ) Other comprehensive income, net of income tax Items that will or may be reclassified to profit or loss Exchange differences on translation of foreign operations 4,684,120 (820,433 ) 1,358,781 Other comprehensive (loss)/profit for the year, net of income tax 4,684,120 (820,433 ) 1,358,781 Total comprehensive (loss) for the year (47,187,703 ) (140,266,637 ) (4,091,432 ) 69 Year Ended June 30, 2025 Compared to Year Ended June 30, 2024 Other Income Other income increased $443 thousand, or 376%, to $560 thousand for the year ended June 30, 2025 compared to $117 thousand for the year ended June 30, 2024. Foreign exchange Foreign exchange decreased $1,225 thousand, or 2,937%, to a $1,183 thousand loss for the year ended June 30, 2025 compared to a $42 thousand gain for the year ended June 30, 2024. Consultants expenses Consultants expenses increased $10,955 thousand, or 792%, to $12,338 thousand for the year ended June 30, 2025 compared to $1,384 thousand for the year ended June 30, 2024, primarily due to the engagement of consultants in relationship with the business combination transaction and other transactions such as the proposed BTC convertible note. Travel and Entertainment Travel and Entertainment increased by $228 thousand, or 478%, to $276 thousand for the year ended June 30, 2025 compared to $48 thousand for the year ended June 30, 2024. Travel and Entertainment is primarily attributable to the increase travel due to the Business Combination. Directors Fees Directors fees increased by $1,254 thousand, or 916%, to $1,391 thousand for the year ended June 30, 2025 compared to $137 thousand for the year ended June 30, 2024. Share Based Payments Share based payments increased by $29,959 thousand, or 4,926%, for the year ended June 30, 2025 compared to $608 thousand for the year ended June 30, 2024 and were related to the share grants to the Company’s directors and executives and senior management. Compliance and Regulatory Fees Compliance and regulatory fees increased by $320 thousand, or 75%, for the year ended June 30, 2025 compared to $426 thousand for the year ended June 30, 2024 and were attributable to the Company’s compliance with the securities laws and regulations in the United States and the other jurisdictions in which the Company operates. Administrative Expenses Administrative expenses reduced by $78 thousand, or 529%, to a credit of $64 thousand for the year ended June 30, 2025 compared to $15 thousand for the year ended June 30, 2024 primarily due to the reversing of previously accrued penalties on the excise tax payable. Promotion, IR, and PR Expenses Promotion, IR and PR Expenses increased by $1,001 thousand, or 523%, to $1,192 thousand for the year ended June 30, 2025, compared to $191 thousand for the year ended June 30, 2024. Finance Costs Finance costs decreased $29,363 thousand, or 98%, to $466 thousand for the year ended June 30, 2025 compared to a $29,829 thousand expense for the year ended June 30, 2024. The decrease is due to initial recognition of the value of financial instruments as part of the business combination in the year ended June 30, 2024. Merger Expenses Merger expenses were $3,000 thousand for the year ended June 30, 2025 compared to $9,374 thousand for the year ended June 30, 2024. The decrease was primarily attributable to costs of the business combination recognized during the year ended June 30, 2024. 70 Listing Expenses Listing Expenses was $76.0 million for the year ended June 30, 2024, compared to nil for the year ended June 30, 2025. Listing Expenses is primarily attributable to cost of the shares issued as part of the business combination. Gain/(loss) on Fair Value of Warrants Gain on fair value of warrants was $50 thousand for the year ended June 30, 2025, compared to a loss on fair value of warrants of $20,623 thousand for the year ended June 30, 2024. Gain/(loss) on fair value of warrants is primarily attributable to change in fair value of warrants accounted for as financial liabilities. Share of net profits of Joint Venture accounting for using the equity method The share of net profits of joint venture in respect to the Tanbreez Project was $702 thousand for the year ended June 30, 2025. Year Ended June 30, 2024 Compared to Year Ended June 30, 2023 Other Income Other income increased $6 thousand, or 6%, to $117 thousand for the year ended June 30, 2024 compared to $111 thousand for the year ended June 30, 2023. Foreign exchange Foreign exchange increased $43,914, or 1,997%, to a $41,715 gain for the year ended June 30, 2024 compared to a $2 thousand loss for the year ended June 30, 2023. Consultants expenses Consultants expenses increased $1,072,908, or 345%, to $1,383 thousand for the year ended June 30, 2024 compared to $311 thousand for the year ended June 30, 2023, primarily due to the engagement of consultants in relationship with the business combination transaction. Travel and Entertainment Travel and Entertainment increased by $25,306 or 113%, to $48 thousand for the year ended June 30, 2024. Travel and Entertainment is primarily attributable to increase travel due to the Business Combination. Directors Fees Directors fees were $137 thousand for the year ended June 30, 2024. Share Based Payments Share based payments was $608 thousand for the year ended June 30, 2024 and were related to the share grants to the Company’s directors and executives and senior management. Compliance and Regulatory Fees Compliance and regulatory fees were $426 thousand for the year ended June 30, 2024 and were attributable to the Company’s compliance with the securities laws and regulations in the United States. Administrative Expenses Administrative expenses decreased $21 thousand, or 58.12%, to $15 thousand for the year ended June 30, 2024 compared to $36 thousand for the year ended June 30, 2023. Promotion, IR, and PR Expenses Promotion, IR and PR Expenses were $191 thousand for the year ended June 30, 2024, compared to $64 thousand, or an increase of $128 thousand or 200%. 71 Finance Costs Finance costs increased $29.8 million, or 200,484% to a $29.8 million expense for the year ended June 30, 2024 compared to a $15 thousand expense for the year ended June 30, 2023. The increase is due initial recognition of the value of financial instruments as part of the business combination. Merger Expenses Merger expenses were $9.4 million for the year ended June 30, 2024 compared to $5.1 million for the year ended June 30, 2023. The increase was primarily attributable to costs of the business combination. Listing Expenses Listing Expenses was $76.0 million for the year ended June 30, 2024. Listing Expenses is primarily attributable to cost of the shares issued as part of the business combination. Gain/(loss) on Fair Value of Warrants Loss on Fair Value of Warrants was $20.6 million for the year ended June 30, 2024. Gain/(loss) on Fair Value of Warrants is primarily attributable to change in fair value of warrants accounted for as financial liabilities. C. Liquidity and Capital Resources Sources and Uses of Liquidity On a historical basis, our principal source of liquidity has been capital contributions from related parties. Our principal uses of cash have been for the exploration and evaluation of the Tanbreez Project, the Wolfsberg Project and for general business expenses. As of June 30, 2025, June 30, 2024 and June 30, 2023, we had approximately $7.3 million, $1.3 million and $0.1 million, respectively, of unrestricted cash. We expect our capital expenditures and working capital requirements to continue to increase materially in the near future as we seek to continue evaluation and exploration of the Wolfsberg Project and the Tanbreez Project. Our actual future capital requirements will depend on many factors, including the results of our DFSs and other studies, final investment decision ahead of the development and construction at the Wolfsberg Project, exploration activities in Zone 2 of the Wolfsberg Project and costs associated with maintaining the Wolfsberg Project site. Our near-term capital requirements with respect to the Tanbreez Project, in accordance with the Heads of Agreement, are expected to include, but not be limited to, mineral exploration and various test work, including metallurgical test work, engineering, geological and logistics studies, socio economic, community and environmental impacts assessments, and construction of roads and operational camps and sites. In addition, we have incurred and expect to continue to incur additional costs as a result of operating as a public company. Substantial doubt exists about our ability to continue as a going concern within one year after the date that the financial statements are available to be issued. We will continue efforts to remedy the conditions or events that raise this substantial doubt, however, as some components of these plans are outside of management’s control, we cannot offer any assurances they will be effectively implemented. We also cannot offer any assurance that any additional financing will be available on acceptable terms or at all. Our consolidated financial statements have been prepared on a going concern basis, which contemplates the continuity of normal business activities and the realization of assets and the settlement of liabilities in the ordinary course of business. We cannot be sure that any additional financing will be available to us on acceptable terms if at all. If we are unable to raise additional capital when desired, our business, operating results, and financial condition could be adversely affected. On July 4, 2023, we entered into the GEM Agreement, pursuant to which we are entitled to draw down up to $125 million of gross proceeds from GEM Investor in exchange for Ordinary Shares, subject to meeting the terms and conditions of the GEM Agreement. We do not anticipate completing a draw down on the GEM Agreement prior to its expiration on the date that is 36 months after the Closing of the Business Combination. In addition, we are currently engaged in discussions with various parties to seek to mitigate our near-term liquidity needs. For example, we are engaged in discussions with EUR to obtain short-term funding, although EUR is under no obligations to provide such funding, and we may ultimately not agree to the terms of such funding. In addition, we would receive proceeds from the exercise of Warrants to the extent such Warrants are exercised for cash. We expect that our strategic collaboration with Obeikan to build and operate a hydroxide plant in Saudi Arabia for the Wolfsberg Project will be beneficial to us, as it would reduce our future costs to build and operate a lithium hydroxide plant on our own. In addition, once operational, the hydroxide plant is expected to significantly reduce energy costs and deliver savings in operating expenditures and capital expenditures related to the Wolfsberg Project that would otherwise be borne by us. Please read “Business — Overview of our Projects — The Wolfsberg Project — Strategic Collaboration between EUR and Obeikan Investment Group.” We have in the past engaged in, and we will continue to engage in, various discussions with third parties related to additional potential equity investments in us. These investments may take the form of convertible preferred shares, ordinary shares or other equity or debt securities. Any equity securities issued may provide for rights, preferences, or privileges senior to those of holders of our ordinary shares. We may also engage in debt financings. If we raise funds by issuing debt securities, these debt securities would have rights, preferences, and privileges senior to those of holders of our ordinary shares. The terms of debt securities or borrowings could impose significant restrictions on our operations. The credit market and financial services industry have in the past, and may in the future, experience periods of uncertainty that could impact the availability and cost of equity and debt financing. Our ability to access capital when needed is not assured and, if capital is not available to us when, and in the amounts needed, we could be required to delay, scale back, or abandon some or all of our expansion efforts and other operations, which could materially harm our business, financial condition and results of operations. 72 On February 7, 2025, the Company completed a private placement of ordinary shares and warrants resulting in aggregate gross proceeds of approximately US$24.6 million (before expenses). Funding raised will be used in developing plans for both the Tanbreez Project and Wolfsberg Project and for general corporate and working capital purposes. Pursuant to the securities purchase agreements, the Company agreed to issue and sell to the PIPE Investors 4,910,000 ordinary shares (the “PIPE Shares”) and 4,910,000 warrants to purchase ordinary shares (the “PIPE Warrants” and, together with a PIPE Share, a “Unit”) for a purchase price of $5.00 per Unit, resulting in aggregate gross proceeds of $24,550,000 million. The PIPE Warrants have an exercise price of $7.00 per share (subject to adjustment) and will expire on February 7, 2029. On June 16, 2025, the Company announced that it received a non-binding letter of interest from the U.S. Export-Import Bank. The letter of interest contemplates that U.S. Export-Import Bank could provide up to $120 million to be used by the Company to develop the Tanbreez Project. On May 27, 2025 we received funds of $2 million from the exercise of Private Warrants held by the Empery Funds. Contractual and Other Obligations Commitments Wolfsberg Lithium Project The DFS is currently work in progress due to the substantial changes of the lithium products prices, increased planned production volumes of lithium hydroxide and plans to build and operate the plant in the Kingdom of Saudi Arabia as a part of newly formed joint venture with Obeikan. Additional studies for the costs optimization of are expected to be completed in the near future. Future capital requirements for the development and construction of the Wolfsberg Project are dependent on a number of factors as outlined above and are expected to be financed primarily through a project financing arrangement in the future. Please read “— Timing of Current Projects and Future Geographic and Product Expansion” and “— Liquidity, Capital Commitments and Resources.” Tanbreez Project Completion of the exploration and drilling program for the Tanbreez Project is currently in progress, with work on the DFS for a 500,000 metric tonnes per annum mining and processing operation at the Tanbreez Project also underway. Future capital requirements for the development and construction of the Tanbreez Project are dependent on a number of factors as outlined above and are expected to be financed primarily through a project financing arrangement in the future. Please read “— Timing of Current Projects and Future Geographic and Product Expansion” and “— Liquidity, Capital Commitments and Resources.” Related Party Capital Contributions Following completion of the merger transaction, EUR has continued to provide financial support to the Company. As at June 30, 2025, the amount owing was $5,854,852, compared to $4,268,857 as at June, 30 2024. For more information regarding our related party transactions, see the section of this annual report entitled “Related Party Transactions — The Company’s Related Person Transactions”, and see Note 17 “Related Party Disclosure” to our interim period unaudited consolidated financial statements and audited financial statements, included elsewhere in this annual report. 73 Cash Flows The following table summarizes our cash flows for the periods presented. June 30, 2025 $ June 30, 2024 $ June 30, 2023 $ Cash flows from operating activities Payments to suppliers and employees (7,448,892 ) (2,596,997 ) (2,467,764 ) Proceeds from related party borrowings 34,603 Interest received from bank accounts 56,001 - - Finance costs (8,031 ) - (7,776 ) Grants received 98,722 75,322 111,218 VAT refund received/(paid) 49,895 7,027 (49,070 ) Tax paid - (658,472 ) - Merger expenses paid (7,244,846 ) (11,949,234 ) - Net cash (used in) operating activities (14,497,151 ) (15,122,354 ) (2,378,789 ) Cash flows from investing activities Payment for property, plant and equipment (2,076 ) - - Payments for exploration and evaluation (1,040,142 ) (1,068,572 ) (2,993,578 ) Investment in joint venture (5,268,316 ) (5,000,000 ) - Investment in Obeikan joint venture (384,685 ) - - Cash at acquisition of Sizzle merger - 9,835,289 - Net cash provided by (used in) investing activities (6,695,219 ) 3,766,717 (2,993,578 ) Cash flows from financing activities Cash from the issue of shares 24,550,000 1,060,938 - Cash from the exercise of warrants for shares 2,709,251 6,170,683 - Payment for share issue costs (1,643,000 ) - - Transfer of cash from unrestricted to restricted - (15,000,000 ) - Cash received in respect of offtake prepayment - 15,000,000 - Funding from related party 1,585,995 4,234,254 - Proceeds from capital contributions - 1,127,417 5,368,057 Repayment of lease liability (12,567 ) (24,483 ) - Net cash provided by financing activities 27,189,679 12,568,809 5,368,057 Net increase/(decrease) in cash and cash equivalents 5,997,309 1,213,172 (4,310 ) Cash and cash equivalents at beginning of year 1,259,242 137,451 136,097 Effects on exchange rate fluctuations on cash held 40,777 (91,381 ) 5,664 Cash and cash equivalents at end of year 7,297,328 1,259,242 137,451 Cash Flows from Operating Activities Our cash flows from operating activities are primarily driven by operating expenses and the payment of expenses in respect to the Wolfsberg Project and Tanbreez Project. We have incurred recurring operating losses and negative cash flows from operating activities. During the years ended June 30, 2025, 2024 and 2023, we incurred Net Losses of $51.9 million, $139.5 million and $5.4 million, respectively. Our Net cash used in operating activities was $14.5 million for the year ended June 30, 2025, $15.1 million for the year ended June 30, 2024 and $2.4 million for the year ended June 30, 2023. The $6.0 million increase in cash from June 30, 2024 to June 30, 2025 was primarily due to receipt of funds from the PIPE and exercise of options. Cash Flows from Investing Activities Our next cash from investing activities for the year ended June 30, 2025, was $6.7 Million representing cash inflows from closing of Business Combination compared to net cash used in investing activities of $3.8 during the years ended June 30, 2024 and deficit of $3.0 million during the year ended June 30, 2023 representing primarily in the payments for exploration and evaluation of the Tanbreez Project and Wolfsberg Project. 74 Cash Flows from Financing Activities Net cash provided by financing activities during the years ended June 30, 2025, 2024 and 2023 was $27.2 million, $12.6 million and $5.4 million, respectively, primarily from funds raised from PIPE and receipt of funds upon the exercise of warrants. PIPE Financing On February 6, 2025, the Company entered into securities purchase agreements (the “PIPE SPA”) with certain accredited investors (each, a “PIPE Investor”). Pursuant to the PIPE SPA, the PIPE Investors agreed to subscribe for and purchase from the Company, and the Company agreed to issue and sell to the PIPE Investors, an aggregate of 4,910,000 Ordinary Shares and 4,910,000 warrants to purchase Ordinary Shares (each, a “PIPE Warrant” and, together with a Share, a “PIPE Unit”) for a purchase price of $5.00 per PIPE Unit, resulting in aggregate gross proceeds of $24,550,000 million for all PIPE Investors, on the terms and subject to the conditions set forth therein (the “PIPE Financing”). The PIPE Warrants have an exercise price of $7.00 per share (subject to adjustment) and will expire on February 7, 2029. The PIPE Financing closed on February 7, 2025. Some PIPE Investors held Ordinary Shares and certain warrants to purchase Ordinary Shares prior to the PIPE Financing. GEM Arbitration On July 4, 2023, we, the GEM Investor and GEM Yield Bahamas Ltd. (“GYBL”) entered into a Share Purchase Agreement (including the GEM Letter Agreements (as defined below), the “GEM Agreements”), pursuant to which we are entitled to draw down up to $125 million of gross proceeds from the GEM Investor in exchange for the issuance of ordinary shares on the terms and conditions set forth in the GEM Agreements. At the time we entered into the GEM Agreement in connection with the closing of the Business Combination, we issued 122,549 ordinary shares to the GEM Investor as a “commitment fee,” as well as warrants to purchase 1,814,797 ordinary shares (which we refer to as the “GEM Warrant”). In addition, in connection with the closing of the Business Combination, we entered into a letter agreement (the “First Letter Agreement”) with the GEM Investor and GYBL, pursuant to which, in exchange for certain commitments from the GEM Investor, the GEM Investor was granted the option to sell the commitment fee shares back to us for $1.875 million on the 61st day following the closing of the Business Combination (the “Commitment Fee Put Amount”). In addition, under the First Letter Agreement the GEM Investor was granted the right to require us to purchase the GEM Warrant on the one-year anniversary of the closing of the Business Combination from GEM Global in exchange for a number of ordinary shares having a value equal to $27,200,000. On April 29, 2024, we, GEM Global and GYBL entered into a second letter agreement (the “Second Letter Agreement”) pursuant to which, among other things, we were granted the option to deliver, in lieu of the Commitment Fee Put Amount on the date upon which it was otherwise due and payable, a payment of $3,020,000 on or prior to the 120th day after the closing of the Business Combination. On September 27, 2024, we, GEM Global and GYBL entered into a third letter agreement (the “Third Letter Agreement” and together with the First Letter Agreement and the Second Letter Agreement, the “GEM Letter Agreements”), pursuant to which, among other things, we agreed to deliver, in lieu of the Commitment Fee Put Amount on the date upon which it was otherwise due and payable, a cash payment of $3,500,000 following the consummation of a capital raising transaction, which amount would incur interest at a 10% annual rate. On February 7, 2025 we completed a capital raising transaction. On February 27, 2025 the GEM Investor exercised its right to require us to purchase the GEM Warrant for an amount of ordinary shares having a value equal to $27,200,000. As of the date of this report, we have not made the cash payment described above or issued the ordinary shares to repurchase the GEM Warrant since we are involved in arbitration proceedings with the GEM Investor. In connection with the arbitration we have made certain counterclaims concerning actions taken by the GEM Investor under the GEM Agreement. We cannot predict the outcome of this arbitration, and as a result we may be required to pay all or a portion of the $3,500,000 and/or issue a material amount of ordinary shares to repurchase the GEM Warrant, in each case plus interest. D. Research and Development, Patents and Licenses, etc. Not applicable. E. Trend Information Other than as described in Item 3.D. “Risk Factors”, in Item 5.A. “Operating Results—Factors that may influence future results of operations”, and in Item 5.B. “Liquidity and Capital Resources” of this Annual Report, which are incorporated by reference herein, we are not aware of any trends, uncertainties, demands, commitments or events that are reasonably likely to have a material effect on our net revenues, income from operations, profitability, liquidity or capital resources, or that would cause the disclosed financial information to be not necessarily indicative of future operating results or financial condition. F. Off-Balance Sheet Arrangements We did not have any off-balance sheet arrangements as of June 30, 2025 or 2024. 75 G. Critical Accounting Policies and Estimates a) Basis of preparation The financial report of Critical Metals Corp (“CRML” or the “Company”) and its wholly owned entities (the “Group”) is a general-purpose financial report, which has been prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”). The Company is a for-profit entity for the purpose of preparing the financial statements. The financial report has also been prepared on the accruals basis and historical cost basis, except for the revaluation of certain financial instruments. The material accounting policies set out below have been applied consistently to all periods presented in the financial report except where stated. b) Principles of consolidation Subsidiaries are all entities over which the Group has control. The Group controls an entity when the Group is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power to direct the activities of the entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are deconsolidated from the date that control ceases. A list of controlled entities is contained in Note 31 of the financial statements. All inter-group balances and transactions between entities in the Group, including any unrealized profits or losses, have been eliminated on consolidation. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with those adopted by EUR. c) Significant accounting estimates and assumptions The carrying amounts of certain assets and liabilities are often determined based on estimates and assumptions of future events. The key estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of certain assets and liabilities within the next annual reporting period are: Share-based payment transactions The Company measures the cost of equity-settled transactions by reference to the fair value of the equity instruments at the date at which they are granted. The fair value of unlisted equity-settled transaction is determined using a Black-Scholes option pricing or Monte Carlos Simulation model taking into account the terms and conditions upon which the instruments were granted. The fair value of listed equity-settled share options granted was based on the fair value of financial instruments traded in active markets based on the quoted market prices at the grant date. Deferred exploration and evaluation expenditure The application of the Group’s accounting policy for exploration and evaluation expenditure requires judgement in determining whether it is likely that future economic benefits are likely from future exploitation or sale or where activities have not reached a stage which permits a reasonable assumption of the existence of reserves. Investment in joint venture The Company’s accounting for its investment in Tanbreez as a joint venture is determined on the basis the CRML has joint control over Tanbreez as outlined in Note 12 to the financial statements. Determining of functional currency Based on the primary indicators in IAS 21 The Effects of Change in Foreign Exchange Rates, the Euro and US Dollar has been determined as the functional currency of various entities within the Group, because the Euro and US Dollar is the currency that mainly influences labour, material and other costs of providing goods or services, and is the currency in which the majority of these costs are denominated and settled. 76 Effects of changes in foreign exchange rates on the consolidation of the financial statements are recorded in other comprehensive income and carried in the form of a cumulative translation adjustment in the accumulated other comprehensive income section of the Statement of financial position of the Group. The presentation currency of the Group has been determined to be US Dollars reflecting the current principal equity and financing structure. Income taxes The Group is subject to income taxes in jurisdictions where it has foreign operations. Significant judgement is required in determining the worldwide provision for income taxes. There are many transactions and calculations undertaken during the ordinary course of business for which the ultimate tax determination is uncertain. The Group estimates its tax liabilities based on the Group’s understanding of the tax laws in the relevant jurisdictions. Where the final tax outcome of these matters is different from the amounts that were initially recorded, such differences will impact the current and deferred income tax assets and liabilities in the period in which such determination is made. The Group recognizes deferred tax assets relating to carried forward tax losses to the extent there are sufficient taxable temporary differences (deferred tax liabilities) relating to the same taxation authority against which the unused tax losses can be utilized. However, utilization of the tax losses also depends on the ability of the entity to satisfy certain tests at the time the losses are recouped. Deferred taxation Potential future income tax benefits have not been brought to account at June 30, 2025 because the Directors do not believe that it is appropriate to regard realizations of future income tax benefits as probable. Warrants The Group measures the cost of warrants by reference to the fair value of the equity instruments at the date at which they are granted and at reporting date. The fair value of the unlisted warrants is determined using a Black-Scholes or Monte Carlos Simulation (MCS) option pricing model taking into account the terms and conditions upon which the instruments were granted. The fair value of listed warrants was based on the fair value of financial instruments traded in active markets based on the quoted market prices at reporting date. d) Cash and cash equivalents Cash and cash equivalents in the Statement of Financial Position comprise cash at bank and in hand and short-term deposits with an original maturity of three months or less. For the purposes of the Statement of Cash Flows, cash and cash equivalents consist of cash and cash equivalents as defined above, net of outstanding bank overdrafts. Restricted cash in the Statement of Financial Position refers to cash that is held for a specific reason and not available for immediate business use. Other Receivables Other receivables measured at amortized cost have maturity of 12 months or less. The Group measures the loss allowance for Other Receivables at an amount equal to lifetime expected credit losses. The Group considers an event of default has occurred when a financial asset is more than 120 days past due or external sources indicate that the debtor is unlikely to pay its creditors, including the Group. A financial asset is credit impaired when there is evidence that the counterparty is in significant financial difficulty or a breach of contract, such as a default or past due event has occurred. The Group writes off a financial asset when there is information indicating the counterparty is in severe financial difficulty and there is no realistic prospect of recovery. 77 Financial Instruments - Fair Value Measurement The fair value of financial assets and financial liabilities must be estimated for recognition and measurement or for disclosure purposes. The fair value of financial instruments traded in active markets (such as publicly traded derivatives, and equity securities classified as fair value through other comprehensive income) is based on quoted market prices at the reporting date. The quoted market price used for financial assets held by the Group is the current bid price, the appropriate quoted market price for financial liabilities is the current ask price. The fair value of financial instruments that are not traded in an active market is determined using valuation techniques. The Group uses a variety of methods and makes assumptions that are based on market conditions existing at each balance date. Quoted market prices or dealer quotes for similar instruments are used for long-term debt instruments held. Other techniques, such as discounted cash flows, are used to determine fair value for the remaining financial instruments. Investment in equity-accounted Associates Associates are entities over which the Group has significant influence but not control or joint control. Investments in associates are accounted for using the equity method. Under the equity method, the share of the profits or losses of the associate is realized in profit or loss and the share of the movements in equity is realized in other comprehensive income. Investments in associates are carried in the statement of financial position at cost plus post acquisition changes in the Group’s share of net assets of the associate. Goodwill relating to the associate is included in the carrying amount of the investment and is neither amortised nor individually tested for impairment. Dividends received or receivable from associates reduce the carrying amount of the investment. When the Group’s share of losses in an associate equals or exceeds its interest in the associate, including any unsecured long-term receivables, the Group does not realize further losses, unless it has incurred obligations or made payments on behalf of the associate. The Group discontinues the use of the equity method upon the loss of significant influence over the associate and realized any retained investment at its fair value. Any difference between the associates carrying amount, fair value of the retained investment and proceeds from disposal is realized in profit or loss. Property, plant and equipment Plant and equipment is reported at cost less accumulated depreciation and impairment. Cost includes expenditure that is directly attributable to the acquisition of the item. In the event that settlement of all or part of the purchase consideration is deferred, cost is determined by discounting the amounts payable in the future to their present value as at the date of acquisition. Depreciation is provided on plant and equipment. Depreciation is calculated on a straight-line basis so as to write off the net cost or other revalued amount of each asset over its expected useful life to its estimated residual value. The estimated useful lives, residual values and depreciation method are reviewed at the end of each annual reporting period. We estimate the useful life of plant and equipment to be 3 years when calculating depreciation. Financial instruments Debt and equity instruments are classified as either liabilities or as equity in accordance with the substance of the contractual arrangement. Transaction costs on the issue of equity instruments are realized directly in equity as a reduction of the proceeds of the equity instruments to which the costs relate. Transaction costs are the costs that are incurred directly in connection with the issue of those equity instruments and which would not have been incurred had those instruments not been issued. 78 Interest and dividends are classified as expenses or as distributions of profit consistent with the statement of financial position classification of the related debt or equity instruments or component parts of compound instruments. e) Impairment of assets At each reporting date, the Company assesses whether there is any indication that an asset may be impaired. Where an indicator of impairment exists, the Company makes a formal estimate of recoverable amount. Where the carrying amount of an asset exceeds its recoverable amount the asset is considered impaired and is written down to its recoverable amount. Recoverable amount is the greater of fair value less costs to sell and value in use. It is determined for an individual asset, unless that asset’s value in use cannot be estimated to be close to its fair value less costs to sell and it does not generate cash inflows that are largely independent of those from other assets or group of assets. In which case, the recoverable amount is determined for the cash-generating unit to which the asset belongs. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. Where an impairment loss subsequently reverses, the carrying amount of the asset is increased to the revised estimate of its recoverable amount, but only to the extent that the increased carrying value does not exceed the carrying amount that would have been determined had no impairment loss been recognized for the asset in prior years. A reversal of an impairment loss is recognized in profit or loss immediately, unless the relevant asset is carried at fair value, in which case the reversal of the impairment loss is treated as a revaluation increase. Income Tax Current tax assets and liabilities for the current and prior periods are measured at the amount expected to be recovered from or paid to the taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted by the reporting date. Deferred tax is provided on all temporary differences at the reporting date between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes. Deferred tax liabilities are realized for all taxable temporary differences except: ● When the deferred tax liability arises from the initial recognition of assets and liabilities (other than as a result of a business combination) which affects neither the accounting profit nor taxable profit or loss; or ● When the taxable temporary difference arises from the initial recognition of goodwill; or ● When the taxable temporary difference is associated with investments in subsidiaries, associates or interests in joint ventures, and the timing of the reversal of the temporary difference can be controlled and it is probable that the temporary difference will not reverse in the foreseeable future. Deferred tax assets are realized to the extent that it is probable that sufficient taxable amounts will be available against which the deductible temporary differences or unused tax losses and tax offsets can be realized, except: ● When the deductible temporary difference giving rise to the asset arises from the initial recognition of assets and liabilities (other than as a result of a business combination) which affects neither accounting profit nor taxable income; or 79 ● When the deductible temporary difference is associated with investments in subsidiaries, associates or interests in joint ventures, in which case a deferred tax asset is only realized to the extent that it is probable that the temporary difference will reverse in the foreseeable future and taxable profit will be available against which the temporary difference can be realized. The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax asset to be realized. Unrecognised deferred income tax assets are reassessed at each reporting date and are realized to the extent that it has become probable that future taxable profit will allow the deferred tax asset to be recovered. Deferred tax assets and liabilities are measured at the tax rates that are expected to apply to the year when the asset is realized or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the reporting date. Deferred tax assets and liabilities are offset when they relate to the same taxation authority and the Company intends to settle its current tax assets and liabilities on a net basis. f) Value added tax Revenues, expenses and assets are recognized net of the amount of VAT except: ● When the VAT incurred on a purchase of goods and services is not recoverable from the taxation authority, in which case the VAT is recognized as part of the cost acquisition of the asset or as part of the expense item as applicable; and receivables and payables are stated with the amount of VAT included. ● The net amount of VAT recoverable from, or payable to, the taxation authority is included as part of receivables or payables in the Statement of Financial Position. Cash flows are included in the Statement of Cash Flows on a gross basis and the VAT component of cash flows arising from investing and financing activities, which is recoverable from, or payable to, the taxation authority are classified as operating cash flows. Commitments and contingencies are disclosed net of the amount of VAT recoverable from, or payable to, the taxation authority. Leases Right of use asset The Group realized right-of-use assets at the commencement date of the lease (i.e., the date the underlying asset is available for use). Right-of-use assets are measured at cost, less any accumulated depreciation and impairment losses, and adjusted for any remeasurement of lease liabilities. The cost of right-of-use assets includes the amount of lease liabilities realized, initial direct costs incurred, and lease payments made at or before the commencement date less any lease incentives received. Unless the Group is reasonably certain to obtain ownership of the leased asset at the end of the lease term, the realized right-of-use assets are depreciated on a straight-line basis over the shorter of its estimated useful life and the lease term. Right-of-use assets are subject to impairment. Lease Liabilities At the commencement date of the lease, the Group realized lease liabilities measured at the present value of lease payments to be made over the lease term. The lease payments include fixed payments (including in-substance fixed payments) less any lease incentives receivable, variable lease payments that depend on an index or a rate, and amounts expected to be paid under residual value guarantees. The lease payments also include the exercise price of a purchase option reasonably certain to be exercised by the Group and payments of penalties for terminating a lease, if the lease term reflects the Group exercising the option to terminate. The variable lease payments that do not depend on an index or a rate are realized as expense in the period on which the event or condition that triggers the payment occurs. In calculating the present value of lease payments, the Group uses the incremental borrowing rate at the lease commencement date if the interest rate implicit in the lease is not readily determinable. After the commencement date, the amount of lease liabilities is increased to reflect the accretion of interest and reduced for the lease payments made. In addition, the carrying amount of lease liabilities is remeasured if there is a modification, a change in the lease term, a change in the in-substance fixed lease payments or a change in the assessment to purchase the underlying asset. 80 The Group has elected not to recognise right of use assets and lease liabilities for short term leases and low value assets. For these leases, the Group realized the lease payments as an expense on a straight line basis over the lease term. Short-term leases and leases of low-value assets. The Group applies the short-term lease recognition exemption for those leases that have a lease term of 12 months or less from the commencement date and do not contain a purchase option. It also applies the lease of low-value assets recognition exemption to leases of plant and equipment that are considered of low value. Lease payments on short-term leases and leases of low-value assets are realized as expense on a straight-line basis over the lease term. g) Foreign Currency Foreign currency transactions and balances All foreign currency transactions occurring during the financial year are recognized at the exchange rate in effect at the date of the transaction. Foreign currency monetary items at reporting date are translated at the exchange rate existing at reporting date. Non-monetary assets and liabilities carried at fair value that are denominated in foreign currencies are translated at the rates prevailing at the date when the fair value was determined. Exchange differences are recognized in the profit or loss in the period in which they arise except those exchange differences which relate to assets under construction for future productive use which are included in the cost of those assets where they are regarded as an adjustment to interest costs on foreign currency borrowings. Functional and presentation currency Items included in the financial statements of each of the companies within the Group are measured in Euro which is the currency of the primary economic environment in which they operate (the functional currency). The consolidated financial statements are presented in US dollars, which is the Company’s presentation currency. Group companies The results and financial position of all the Group entities (none of which has the currency of a hyperinflationary economy) that have a functional currency different from the presentation currency are translated into the presentation currency as follows: ● assets and liabilities for each statement of financial position presented are translated at the closing rate at the date of that statement of financial position; ● income and expenses for each statement of profit or loss and other comprehensive income are translated at average exchange rates (unless this is not a reasonable approximation of the cumulative effect of the rates prevailing on the transaction dates, in which case income and expenses are translated at the dates of the transactions), and ● all resulting exchange differences are recognized in other comprehensive income. 81 h) Trade and other payables Trade payables and other accounts payable are carried at amortized cost and represent liabilities for goods and services provided to the Group prior to the end of the financial year that are unpaid and arise when the Group becomes obliged to make future payments in respect of the purchase of those goods and services. i) Exploration and evaluation expenditure Exploration and evaluation expenditures in relation to each separate area of interest are recognized as an exploration and evaluation asset in the year in which they are incurred where the following conditions are satisfied: ● the rights to tenure of the area of interest are current; and ● at least one of the following conditions is also met: ● the exploration and evaluation expenditures are expected to be recouped through successful development and exploration of the area of interest, or alternatively, by its sale; or ● exploration and evaluation activities in the area of interest have not at the balance date reached a stage which permits a reasonable assessment of the existence or otherwise of economically recoverable reserves, and active and significant operations in, or in relation to, the area of interest are continuing. Exploration and evaluation assets are initially measured at cost and include acquisition of rights to explore, studies, exploratory drilling, trenching and sampling and associated activities and an allocation of depreciation and amortized of assets used in exploration and evaluation activities. General and administrative costs are only included in the measurement of exploration and evaluation costs where they are related directly to operational activities in a particular area of interest. Exploration and evaluation assets are assessed for impairment when facts and circumstances suggest that the carrying amount of an exploration and evaluation asset may exceed its recoverable amount. The recoverable amount of the exploration and evaluation asset (for the cash generating unit(s) to which it has been allocated being no larger than the relevant area of interest) is estimated to determine the extent of the impairment loss (if any). Where an impairment loss subsequently reverses, the carrying amount of the asset is increased to the revised estimate of its recoverable amount, but only to the extent that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognized for the asset in previous years. Where a decision has been made to proceed with development in respect of a particular area of interest, the relevant exploration and evaluation asset is tested for impairment and the balance is then reclassified to development. Investment in equity-accounted Joint Venture A joint venture is an arrangement that the Group controls jointly with one or more other investors, and over which the Group has rights to a share of the arrangement’s net assets rather than direct rights to underlying assets and obligations for underlying liabilities. The joint venture is accounted for using the equity method. Under the equity method, the share of the profits or losses of the joint venture is recognized in profit or loss and the share of the movements in equity is recognized in other comprehensive income. Investments in joint ventures are carried in the statement of financial position at cost plus post-acquisition changes in the Group’s share of net assets of the joint venture. Any goodwill or fair value adjustment attributable to the Group’s share in the joint venture is not recognized separately and is included in the amount recognized as investment. 82 The carrying amount of the investment in joint venture is increased or decreased to recognize the Group’s share of the profit or loss and other comprehensive income of the joint venture, adjusted where necessary to ensure consistency with the accounting policies of the Group. Unrealised gains and losses on transactions between the Group and the joint venture are eliminated to the extent of the Group’s interest in those entities. Where realized losses are eliminated, the underlying asset is also tested for impairment. j) Share capital Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax, from the proceeds. Incremental costs directly attributable to the issue of new shares or options for the acquisition of a business are not included in the cost of the acquisition as part of the purchase consideration. Warrants Liability Warrants as classified as liabilities because the warrants do not meet the criteria for equity treatment. Accordingly, the Company will classify each warrant as a liability at its fair value. This liability is subject to re-measurement at each balance sheet date. With each such re-measurement, the warrant liability will be adjusted to fair value, with the change in fair value recognized in the Company’s consolidated statement of comprehensive income. New and Recently Adopted Accounting Pronouncements From time to time, new accounting pronouncements are issued by the IASB or other standard setting bodies that are adopted by us as of the specified effective date. Unless otherwise discussed, we believe that the impact of recently issued standards that are not yet effective will not have a material impact on our financial position or results of operations. See Note 2 to our interim period unaudited consolidated financial statements and audited consolidated financial statements included elsewhere in this annual report for more information about recent accounting pronouncements, the timing of their adoption and our assessment, to the extent we made one, of their potential impact on our financial condition and results of operations. Emerging Growth Company As defined in Section 102(b)(1) of the JOBS Act, we are an emerging growth company (“EGC”). As such, we will be eligible for and intends to rely on certain exemptions and reduced reporting requirements provided by the JOBS Act, including (a) the exemption from the auditor attestation requirements with respect to internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act, (b) the exemptions from say-on-pay, say-on-frequency and say-on-golden parachute voting requirements and (c) reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements. We will remain an EGC under the JOBS Act until the earliest of (i) the last day of the fiscal year in which the market value of our ordinary shares that are held by nonaffiliates exceeds $700 million as of the last business day of the second quarter of that fiscal year, (ii) the last day of the fiscal year in which it has total annual gross revenue of $1.235 billion or more during such fiscal year (as indexed for inflation), (iii) the date on which it has issued more than $1 billion in non-convertible debt in the prior three-year period or (iv) the last day of the fiscal year following the fifth anniversary of the date of the Closing. 83