The directors present the strategic report for the year ended 30 June 2023.

The principal activity of the company continued to be that of mining and processing of gold and silver.

During the year, there was a modest increase in the scale of operations, with headfeed volumes rising to 25,558.3 tonnes (2022: 23,083.6 tonnes), an increase of 10.7%. However, the attainment of a steady-state headfeed level of 3,000 tonnes per month remained elusive, with this level only achieved for two months of the year.

Turnover for the year decreased by 11.3% to £8,568,828 (2022: £9,665,038).

Commercial production has been defined by the Board of Directors as the point at which positive net cash flow has been generated by production operations for three consecutive months. Once this stage is reached, production costs incurred are charged to profit and loss, while costs incurred prior to that stage, which were capitalised as part of the mine development asset, are amortised on a production-related basis.

As reported in the prior year, the company reached the stage of commercial production on 30 June 2022.

The expensing of production costs during the year, together with the amortisation of previously capitalised development costs, accounted for the significant increase in the company’s cost base. Total costs rose to £24,404,509 (2022: £12,647,043).

The company incurred a loss before financing costs of £15,835,681 (2022: £2,982,005). Net financing costs increased to £1,684,256 (2022: £1,391,733), resulting in a loss before taxation of £17,519,937 (2022: £4,373,738).

Outstanding borrowings at year end amounted to £14,709,413 (2022: £12,239,948), with an additional £785,000 drawn during the year under the Fern Wealth unsecured loan facility.

Major capital expenditure during the year included the acquisition of a second-hand Dux truck, a second-hand scooptram, and a thickener, at a combined cost of £627,554.

As in the prior year, no dividends were declared.

The company is exposed to volatility in commodity prices and exchange rates, with movements in the gold price being influenced by global macroeconomic conditions and political or economic events.

Operational risks include variability in ore grades, the reliability of mining and processing equipment, and the availability of suitably skilled personnel. Each of these factors presents material risks to the achievement of a consistent, steady-state production profile.

The company’s immediate focus is on stabilising operations and moving towards consistent production performance at the Cononish Gold Mine. Priorities identified by the Board at the reporting date include:

• Achieving steady-state throughput of 3,000 tonnes per month on a sustainable basis.

• Improving reliability of key mining and processing equipment to reduce unplanned downtime.

• Commissioning of new assets acquired during the year, including the Dux truck, scooptram, and thickener, to strengthen operational capacity.

• Enhancing cost management through tighter operational control and disciplined allocation of resources.

• Ongoing development of the workforce, ensuring the availability of suitably skilled and experienced personnel.

• Engagement with stakeholders, including regulators and the local community, to support the long-term development of the project.

Post balance sheet events

Subsequent to the year end, on 6 March 2025, Acrux Holdings Limited (subsequently renamed Acrux Gold Limited) acquired the entire issued share capital of the company. As part of the acquisition arrangements, Acrux Gold Investco Limited subscribed USD 15 million for new shares in Acrux Gold Limited, the proceeds of which were earmarked to fund the operational restart programme at the Cononish Gold Mine. In addition, Acrux Gold Limited acquired all rights, title and interest in the loans previously owed by the Company to Bridge Barn Limited, Fern Wealth GmbH, Jane Styslinger and Scotgold Resources Limited.

These transactions have significantly strengthened the financial position of the company and underpin its going concern basis of preparation.

• Turnover decreased by £1,096,210 (2022: increase of £9,499,188)

• Total cost base (excluding financing costs) increased by £11,757,466 (2022: increase of £11,073,944)

• Loss before financing costs increased by £12,853,676 (2022: increase of £1,805,890)

• Net financing costs increased by £292,523 (20.5%) (2022: increase of £346,219 (33%))

• Loss before taxation increased by £13,146,199 (2022: increase of £2,151,713)

• Borrowings increased by £2,469,465 (20%) (2022: increase of £2,600,514 (27%))

On behalf of the board

The directors present their annual report and financial statements for the year ended 30 June 2023.

The company incurred a loss before taxation of £17,519,937 (2022: £4,373,738). Commentary on that result is provided in the strategic report.

As in the prior year, no dividends were declared.

The directors who held office during the year and up to the date of signature of the financial statements were as follows:

Azets Audit Services were appointed in August 2025 as auditor to the company and in accordance with section 485 of the Companies Act 2006, a resolution proposing that they be re-appointed will be put at a General Meeting.

The directors are responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:

• select suitable accounting policies and then apply them consistently;

• make judgements and accounting estimates that are reasonable and prudent;

• prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company’s transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the company’s auditor is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the company’s auditor is aware of that information.

Disclaimer of opinion

We were engaged to audit the financial statements of SGZ Cononish Limited (the 'company') for the year ended 30 June 2023 which comprise the profit and loss account, the balance sheet, the statement of changes in equity, the statement of cashflows and the notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).

We do not express an opinion on the accompanying financial statements of the company. Because of the significance of the matter described in the basis for disclaimer of opinion section of our report, we have not been able to obtain sufficient appropriate audit evidence to provide a basis for an audit opinion on these financial statements.

Basis for disclaimer of opinion

We were not appointed as auditor of the company until August 2025. The company’s previous parent company, Scotgold Resources Limited went into liquidation on 29 February 2024. The shares of the company were purchased by new investors on 6 March 2025. The former directors did not maintain appropriate accounting records for the year ended 30 June 2023. The new directors have recreated the accounting records from the limited information available. However due to a lack of supporting evidence we were unable to confirm or verify by alternative means the balances and transactions in respect of sales, trade debtors, cost of sales (excluding payroll, amortisation and depreciation) and creditors. In addition to this we were also unable to obtain adequate assurance in respect of the opening balances in respect of trade debtors and creditors. We were able to obtain sufficent assurance over the balances and transactions in respect of intangible fixed assets, tangible fixed assets, other debtors and bank including in respect of these opening balances. Due to the lack of accounting records we were unable to perform audit work over the risk of management bias and override of controls.

As a result of these matters we were unable to determine whether any adjustments might have been found necessary in respect of these balances and transactions and the elements making up the profit and loss account, the balance sheet, the statement of changes in equity and the statement of cashflows.

Opinions on other matters prescribed by the Companies Act 2006

Because of the significance of the matter described in the basis of disclaimer of opinion section of our report, we have been unable to form an opinion whether, based on the work undertaken in the course of the audit:

• the information given in the strategic report and the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and

• the strategic report and the directors' report have been prepared in accordance with applicable legal requirements.

Notwithstanding our disclaimer of an opinion on the financial statements, in the light of the knowledge and understanding of the company and its environment obtained in the course of the audit performed subject to the pervasive limitation described above, we have not identified material misstatements in the strategic report or the directors' report.

Arising from the limitation of our work referred to above:

• we have not obtained all the information and explanations that we considered necessary for the purpose of our audit; and

• we have determined that adequate accounting records have not been kept.

We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:

• returns adequate for our audit have not been received from branches not visited by us; or

• the financial statements are not in agreement with the accounting records and returns; or

• certain disclosures of directors’ remuneration specified by law are not made.

As explained more fully in the directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.

Our responsibility is to conduct an audit of the company’s financial statements in accordance with International Standards on Auditing (UK) and to issue an auditor’s report. However, because of the matter described in the basis for disclaimer of opinion section of our report, we were not able to obtain sufficient appropriate audit evidence to provide a basis for an audit opinion on these financial statements.

We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard and we have fulfilled our other ethical responsibilities in accordance with these requirements.

Extent to which the audit was considered capable of detecting irregularities, including fraud

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue a Report of the Auditors that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists.

Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above and on the Financial Reporting Council’s website, to detect material misstatements in respect of irregularities, including fraud.

We obtain and update our understanding of the entity, its activities, its control environment, and likely future developments, including in relation to the legal and regulatory framework applicable and how the entity is complying with that framework.  Based on this understanding, we identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion.  This includes consideration of the risk of acts by the entity that were contrary to applicable laws and regulations, including fraud.

In response to the risk of irregularities and non-compliance with laws and regulations, including fraud, we designed procedures which included:

• Enquiry of management and those charged with governance around actual and potential litigation and claims as well as actual, suspected and alleged fraud; 

• Assessing the extent of compliance with the laws and regulations considered to have a direct material effect on the financial statements or the operations of the company through enquiry and inspection; 

• Reviewing financial statement disclosures and testing to supporting documentation to assess compliance with applicable laws and regulations;

• Performing audit work over the risk of management bias and override of controls, including testing of journal entries and other adjustments for appropriateness, evaluating the business rationale of significant transactions outside the normal course of business and reviewing accounting estimates for indicators of potential bias. 

Due to the significance of the matters described in the 'Basis for Disclaimer of Opinion' section of our report, we have not been able to satisfactorily perform all of the procedures as designated above. Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation.  This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance.  The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

Other matters which we are required to address

The comparative figures in respect of the prior year are unaudited.

Use of our report

This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed.

The profit and loss account has been prepared on the basis that all operations are continuing operations.

SGZ Cononish Limited is a private company limited by shares incorporated in Scotland. The registered office is 28 Albyn Place, Aberdeen, United Kingdom, AB10 1YL.

These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006 as applicable to companies subject to the small companies regime. The disclosure requirements of section 1A of FRS 102 have been applied other than where additional disclosure is required to show a true and fair view.

The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.

The financial statements have been prepared under the historical cost convention, modified to include certain financial instruments at fair value. The principal accounting policies adopted are set out below.

At the date of approval of these financial statements, the directors have considered the truecompany’s ability to continue as a going concern. The company remains reliant on the financial support of its parent, Acrux Gold Limited (formerly Acrux Holdings Limited), which acquired the entire issued share capital of the company on 6 March 2025 (as described in the note on Events after the reporting date).

As part of the acquisition arrangements, Acrux Gold Investco Limited subscribed USD 15 million for new shares in Acrux Gold Limited, the proceeds of which were earmarked to fund the operational restart programme at the Cononish Mine. In addition, Acrux Gold Limited acquired all rights, title and interest in the loans previously owed by the company to Bridge Barn Limited, Fern Wealth GmbH, Jane Styslinger and Scotgold Resources Limited, together with intercompany balances with SGZ Grampian Limited. The parent company has confirmed via a letter of support, that it does not intend to require repayment of any of these balances for a period of at least 12 months from the date of approval of these financial statements.

The company has prepared detailed forecasts and cash flow projections extending beyond 12 months from the date of approval of these financial statements. These forecasts, which assume continued financial support from the parent and successful implementation of the operational restart plan, indicate that the Company should have sufficient resources to meet its obligations as they fall due.

Based on the parent company’s confirmed support and the directors’ review of forecasts, the financial statements have been prepared on a going concern basis.

Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.

When cash inflows are deferred and represent a financing arrangement, the fair value of the consideration is the present value of the future receipts. The difference between the fair value of the consideration and the nominal amount received is recognised as interest income.

Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on dispatch of the goods), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.

Under the current industry practice, exploration expenditure is capitalised if it meets certain criteria in accordance with International Financial Reporting Standards. As there is no equivalent standard under United Kingdom Generally Accepted Accounting Practice, the company has applied the provisions of International Financial Reporting Standard 6 ‘Exploration for and Evaluation of Mineral Resources’ as best practice. Revenues earned from the sale of material produced in connection with exploration activities are applied against the accumulated deferred expenditure with the result of reducing those expenditures.

Exploration expenditure is capitalised until the results of the related projects are known. When an exploration area of interest meets certain criteria, including the determination of technical feasibility and commercial viability and the obtaining of all planning consents and approvals, the deferred exploration and evaluation costs attributable to that area of interest are reclassified as a mine development asset.

Provision for loss is made where a project is abandoned or considered to be of no further interest to the company.

All subsequent expenditure on mine development activities is capitalised. Assets under construction or being prepared for use are accounted for as part of the mine development asset and are transferred to plant and equipment on completion of construction of those assets or on completion of preparation of those assets for use.

Commercial production has been defined by the board of directors as the point at which positive net cash flow has been generated by production operations for a period of three consecutive months. Production costs incurred prior to the company reaching the stage of commercial production are charged to the mine development asset. These costs are not amortised during the mine development phase, but the carrying value thereof is assessed for impairment whenever facts and circumstances suggest that the carrying amount may exceed the recoverable amount thereof by taking into account discount rates, gold and silver prices and ore reserve estimates.

Once the stage of commercial production has been achieved, the mine development asset is amortised over the life of the mine to which the development asset relates according to the rate of depletion of the economically recoverable reserves of that mine or amortised on the basis of production – related metrics, as appropriate. The stage of commercial production was achieved on 30 June 2022.

The present value of restoration, decommissioning and environmental monitoring liabilities attributable to mine development activities, as well as any changes in the present value of such liabilities arising due to changes in the cash flows used to determine such liabilities or the discount rate applied to cash flows used to determine such liabilities, is included in the mine development asset.

Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.

Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.

At each reporting period end date, the company reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any).

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.

Stocks held for distribution at no or nominal consideration are measured at the lower of cost and replacement cost, adjusted where applicable for any loss of service potential.

At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.

Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.

The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.

Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.

Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.

Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.

Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.

Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.

If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.

Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the company transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.

Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.

Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.

Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.

Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.

Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.

Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.

Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.

The tax expense represents the sum of the tax currently payable and deferred tax.

The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.

The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.

Provisions are recognised when the company has a legal or constructive present obligation as a result of a past event, it is probable that the company will be required to settle that obligation and a reliable estimate can be made of the amount of the obligation.

The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the reporting end date, taking into account the risks and uncertainties surrounding the obligation. Where the effect of the time value of money is material, the amount expected to be required to settle the obligation is recognised at present value. When a provision is measured at present value, the unwinding of the discount is recognised as a finance cost in profit or loss in the period in which it arises.

The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.

The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.

Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.

Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.

Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.

Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.

Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leases asset are consumed.

In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.

The auditors remuneration for audit services is £30,000.

The average monthly number of persons (including directors) employed by the company during the year was:

The total emoluments payable to directors and key management personnel was £155,000 (2022: £25,833), pension contribution of £5,683 (2022: £nil) and employers' NI of £19,991 (2022: £3,660).

The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 1 (2022 - 0).

Loans

During the year ended 30 June 2023 the following amendments were made to the terms of the secured loan facility agreement entered into on 18 May 2018 between the company and Bridge Barn Limited (as amended by various subsequent restatement and amendment agreements entered into between the parties up to and including 30 June 2022), a wholly owned and controlled company of Nat le Roux, a director of the company:

- on 9 February 2023, Bridge Barn Limited provided the company with the option to defer repayment of the principal amounts due for repayment in the 2023 calendar year by up to 9 months from the original date of repayment, provided that a nominal interest rate of 13% (non-compounding) be applicable for the period of such deferral, these tranches being the Third, Fourth and Fifth Tranches; and

- on 5 April 2023, Bridge Barn Limited agreed to postpone all interest payments due and payable at that date up to and including 1 December 2023.

The terms of the secured loan facility as at 30 June 2023 are accordingly as follows:

i) An overall facility amount of £8,500,000, all of which had been drawn down by 30 June 2022;

ii) Nominal interest rate of 9.0% payable quarterly in arrears is applied to all amounts drawn down up to date of repayment, rising to 13% per annum (non-compounding) during any period of deferral where the company takes up the option to defer repayment of the Third, Fourth and Fifth Tranches for a period of up to 9 months beyond the original scheduled date of repayment of those tranches (with the company having taken up that option in the case of all three tranches);

iii) Each tranche or sub-tranche, as appropriate, is repayable 36 months after the date of drawdown of that

tranche or sub-tranche, except in the cases of the Third, Fourth and Fifth Tranches in respect of which the

company has the option to defer repayment of any of those tranches for a period of up to 9 months after the

original scheduled date of repayment thereof; and

iv) Security for repayment is provided by way of Debenture over all of the assets and undertakings of the

company and the company's fellow subsidiary, SGZ Grampian Limited, including the transfer of security of the

issued capital of the company and SGZ Grampian Limited.

During the prior year, an unsecured loan facility in an amount of £500,000 was provided to the company by Jane Styslinger, the wife of a director of the parent company of the company.

The terms of the unsecured loan facility at 30 June 2023 are as follows:

i) A facility amount of £500,000, all of which had been drawn down by 30 June 2022;

ii) Nominal interest rate of 9.0% payable quarterly in arrears; and

iii) Principal debt payable by 20 January 2024, being two years after the date of drawdown.

Obligations under finance leases

The assets funded are held as security by the finance provider.

This provision represents the best estimate of the present value of expenditures required to effect restoration of the Cononish mine area at the end of mining operations at the mine as well as to carry out aftercare and monitoring activities in terms of the Decommissioning and Restoration Plan formulated in accordance with the requirements set out in the Section 75 Agreement entered into by the Company on 12 September 2018, based on the mine development activities carried out up to and including 30 June 2023.

In arriving at the amount of the provision, an inflation rate of 8.5% (2022 - 4%) has been applied to estimated future costs stated at current levels and the resultant cashflows have been discounted back to 30 June 2023 using a discount rate of 3.97% (2022 - 0.98%).

The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:

Greater Cononish Glen Management Plan

As part of the Section 75 Agreement entered into between the Company, the owner of the land on which the Cononish mine is situated, the Loch Lomond and the Trossachs National Park Authority and the Crown Estate Scotland in respect of the development of the Cononish mine, the Company has assumed obligations to implement a plan for the management of the greater Cononish glen in which the Cononish mine is situated.

The total cost of meeting these obligations is £89,465, split as £4,331 due not later than one year, £2,251 due later than 1 year but not later than 2 years, £7,028 due later than 2 years but not later than 5 years and £75,855 due later than 5 years.

Minimum certain rent payments

In terms of the lease agreement between the Company and the owners of the land on which the Cononish mine is situated, an annual rental, indexed to the Retail Price Index (“RPI”) is payable annually for all future periods up to 21 December 2039.

The total expected cost of meeting these obligations (assuming an 8.5% per annum increase in the RPI in future) is £759,895, split as £24,993 due not later than one year, £25,717 due later than 1 year but not later than 2 years, £87,621 due later than 2 years but not later than 5 years and £621,564 due later than 5 years.

Minimum royalty payments

The lease agreement between the Company and the owner of the land on which the Cononish mine is located provides that royalties at rates of between 3.5% and 10% shall be payable to the landowner on the net realisable value of any minerals produced at the Cononish mine other than gold, silver or other precious metals, subject to the payment of a minimum royalty of £26,505 per annum at a base date of 23 July 2009, indexed to the United Kingdom Retail Price Index ("RPI").

The total expected cost of meeting these obligations (assuming an 8.5% per annum increase in the RPI in future) is £1,421,384, split as £46,750 due not later than one year, £48,104 due later than 1 year but not later than 2 years, £163,895 due later than 2 years but not later than 5 years and £1,162,635 due later than 5 years

Certain Rent payments

The lease agreement between the Company and the Crown Estate Commissioners in respect of the Cononish mine provides for the payment of a minimum amount of Certain Rent at a rate of £150,000 per annum, payable half-yearly on 1 January and 1 July of each year and indexed in accordance with RPI from a date determined by the Crown Estate Commissioners.

The total expected cost of meeting these obligations (assuming an 8.5% per annum increase in the RPI in future) is £1,572,987, split as £150,000 due not later than one year, £150,000 due later than 1 year but not later than 2 years, £780,572 due later than 2 years but not later than 5 years and £492,415 due later than 5 years.

Amounts payable to Loch Lomond and the Trossachs Countryside Trust

Amounts are payable to the Loch Lomond and the Trossachs Countryside Trust in terms of Clause 18 of the Section 75 Agreement entered into with the owner of the land on which the Cononish mine is situated, the Loch Lomond and the Trossachs National Park Authority and the Crown Estate Scotland in respect of the development of the Cononish mine.

These amounts are £275,000 in total, split as £25,000 due not later than one year, £25,000 due later than 1 year but not later than 2 years, £150,000 due later than 2 years but not later than 5 years and £75,000 due later than 5 years.

Rental of immovable property (operating leases)

Rental payments expected to be incurred in terms of rental agreements in place in respect of immovable property after 30 June 2023 amount to £6,913,379 in total, split as £1,076,396 due not later than one year, £1,166,033 due later than 1 year but not later than 2 years, £3,939,109 due later than 2 years but not later than 5 years and £731,841 due later than 5 years.

Rental of mobile equipment (operating leases)

Rental payments in respect of agreements for the rental of mobile equipment, generators and portable accommodation utilised in mining activities are due to be made after 30 June 2023.

The total expected cost of meeting these obligations is £1,335,626, split as £736,113 due not later than one year and £599,513 due later than 1 year but not later than 2 years.

The directors have considered events occurring after the reporting date of 30 June 2023. All material events identified are non-adjusting in nature and therefore no adjustments have been made to these financial statements. Further detail is set out below.

Suspension and administration of former parent company

On 11 September 2023, Scotgold Resources Limited, the parent company of the company at the reporting date, was suspended from trading on the Alternative Investment Market (“AIM”) of the London Stock Exchange.

On 28 September 2023, the operations of the company were placed on a care and maintenance basis. The majority of employees were placed on unpaid leave and all mining and processing operations were suspended, with only essential activities undertaken to preserve assets and ensure compliance with legal, environmental and health and safety obligations.

Scotgold Resources Limited entered administration on 24 November 2023 and its AIM listing was cancelled with effect from 27 December 2023.

Change of ownership and capital structure

On 12 January 2024, Bridge Barn Limited replaced Scotgold Resources Limited as the parent company of the company.

On the same date, the 100 ordinary shares of £1 each in issue were subdivided into 100,000 ordinary shares of £0.001 each.

On 31 January 2024, 24,560 ordinary shares were issued for proceeds of £245,586. On 6 May 2024, a further 8,334 ordinary shares were issued for proceeds of £300,000.

On 6 March 2025, Acrux Holdings Limited (subsequently renamed Acrux Gold Limited) acquired the entire issued share capital of the company and the secured and unsecured loan positions from Bridge Barn Limited, Fern Wealth GmbH and Jane Styslinger under a Share Purchase Agreement.

As part of the acquisition arrangements, Acrux Gold Investco Limited subscribed USD 15 million for new shares in Acrux Gold Limited. These proceeds were earmarked to fund the operational restart programme at the Cononish Mine.

On 18 March 2025, Acrux Gold Limited also acquired the loan owing by the company to Scotgold Resources Limited, together with the unfettered rights to determine the terms of the promissory notes and intercompany balances owing to SGZ Grampian Limited. The parent company has confirmed that it does not intend to require repayment of any of these loans or balances for at least 12 months from the date of approval of these financial statements.

Financing and asset disposals

The short-term secured loan from MRI Trading AG was repaid in accordance with its terms. However, the company did not meet repayment obligations in respect of certain unsecured loans or the secured loan from Bridge Barn Limited.

With one exception, all mobile plant and vehicles financed under hire purchase agreements were repossessed in February and July 2024. Mobile plant hired from an OEM supplier was returned following the transition to care and maintenance.

Rental agreements for immovable property were terminated, with the exception of the farmhouse and sheds at Cononish Mine.

Aggregate amounts payable by the company to parties related to Directors of the company and Directors of the parent company of the company are as follows:

Bridge Barn Limited: Principal debt of £8,500,000 (2022: £8,500,000) and accumulated interest of £1,358,205 (2022: £647,756) with an interest charge of £775,925 incurred by the company in the year.

The company issued promissory notes with a face value of £15,138,662 to SGZ Grampian Limited (the sole fellow subsidiary of the company) in January 2018 (see Note 11). There have been no changes in the terms applicable to the promissory notes since the date of issue thereof and at 30 June 2023, these promissory notes have no fixed date of repayment and interest is payable thereon annually at a nominal interest rate of 3%.

The interest charge in the year was £440,535 (2022: £467,785). The year end balance was £17,634,676 (2022: £17,194,141).

The company owes amounts to its parent company and SGZ Grampian Limited on intercompany accounts with no fixed terms of repayment of and no interest payable on balances outstanding on those intercompany accounts.

The year end balance owed by the company to its parent was £6,623,709 (2022: £5,396,399).

The company owes amounts to fellow subsidiary SGZ Grampian Limited with no fixed terms of repayment and no interest on balances outstanding on those intercompany accounts. The year end balance was £7,332,401 (2022: £4,660,027).

In the year ended 30 June 2022, an unsecured loan facility for an amount of £500,000 was provided to the company by Jane Styslinger, the wife of a director of the parent company of the company. At the year end,  the principal debt was £500,000 (2022: £500,000) with accumulated interest of £42,526 (2022: £11,250) with an interest charge of £53,776 incurred by the company in the year.

The immediate and ultimate parent company at the year end was Scotgold Resources Limited, a company incorporated in Australia.

Acrux Gold Limited acquired the entire issued share capital of the company on 6 March 2025 and became the parent company with effect from that date.