[Karelian]
4 November 2026
Karelian Diamond Resources plc
("Karelian" or the "Company")
FINAL RESULTS FOR THE YEAR ENDED 31 MAY 2026
Karelian Diamond Resources plc (AIM: KDR), the diamond exploration company
focused on Finland with nickel, copper and platinum interests in Northern
Ireland, announces its final results for the year ended 31 May 2026.
Details of these can be found below and a full copy of the Company's annual
report and audited financial statements (the "Annual Report") will be available
shortly on the Company's website (www.kareliandiamondresources.com).
Highlights of the period included:
· In June 2025, shortly after the start of the year under review, the Finnish
Safety and Chemical Agency (Tukes) registered the mining rights for Lahtojoki
and issued the mining concession certificate, after more than eight years of
engagement with the relevant authorities.
· The focus of the Company's efforts on this project throughout the year has
been on securing finance to take Lahtojoki through the development stage and on
to production. The discussions have continued throughout the year and remain
ongoing.
· In the Kuhmo Region the focus was the geophysical target designated Anomaly
5. A three-hole drilling programme totalling approximately 334 metres was
completed and beneath an exceptionally thick overburden of some 35 metres, two
of the three holes intersected rock material provisionally interpreted as
olivine lamproite, a rock type associated with diamond-bearing provinces
globally.
· The next steps will include a limited ground electromagnetic survey, which
will allow for more accurate drill targeting once conditions permit mobilisation
of a rig.
· The Company holds a significant licence package covering over 1,000 km² in
Northern Ireland, where it has established first mover advantage and has
continued to advance its exploration programme for nickel, copper and platinum
group elements. Exploration programmes have been planned which will commence
with detailed geological mapping and geochemical sampling.
Brendan McMorrow, Chairman of Karelian, said:
"The Company has entered the new financial year with its mining rights at
Lahtojoki secured, a first set of encouraging drill results from Anomaly 5, and
a clear work programme for its highly prospective nickel, copper and platinum
group element targets in Northern Ireland. The Board remains confident regarding
the prospects for the Company."
Annual Report and Financial Statements for the year ended 31 May 2026
The full audited annual report and financial statements for the year ended 31
May 2026 has been posted to shareholders and will be published on the Company's
website (www.kareliandiamondresources.com) shortly. Key elements can also be
viewed at the bottom of this announcement.
Further Information:
Karelian Diamond Resources plc +353-1-479-6180
Brendan McMorrow, Chairman
Maureen Jones, Managing Director
Allenby Capital Limited (Nomad) +44-20-3328-5656
Nick Athanas / Nick Harriss
Albr Capital Limited (Broker) +44-20-7469-0930
Lucy Williams / Duncan Vasey
Lothbury Financial Services +44-20-3290-0707
Michael Padley
Hall Communications +353-1-660-9377
Don Hall
http://www.kareliandiamondresources.com
Chairman's Statement
Dear Shareholder,
I am pleased to present the Company's Annual Report and Financial Statements for
the year ended 31 May 2026. It has been a year of real operational progress: the
Company's mining rights at Lahtojoki were formally registered, the priority
Anomaly 5 diamond target in the Kuhmo region was drilled for the first time with
encouraging initial results, and the exploration programme for nickel, copper
and platinum group elements in Northern Ireland was advanced on several fronts.
The Lahtojoki Diamond Deposit
In June 2025, shortly after the start of the year under review, the Finnish
Safety and Chemical Agency (Tukes) registered the mining rights for Lahtojoki
and issued the mining concession certificate. The certificate formally entitles
the Company to utilise the minerals within the mining concession area. Following
more than eight years of engagement with the relevant authorities, this
represented the culmination of the permitting process and a critical milestone,
allowing the Company to plan and proceed to the next stage of work on the
concession area.
The Lahtojoki mining project comprises a mining concession covering 71 hectares
(c. 175 acres), including a kimberlite pipe with a surface area of 1.6 hectares
(c. 4 acres). In addition to high quality colourless gem diamonds, the deposit
contains coloured diamonds and in particular pink diamonds, which are highly
sought after and can command prices of a multiple of those achieved by
comparable colourless stones. The 2017 Preliminary Economic Assessment on the
deposit, which excluded the impact on project revenue of the known potential for
coloured diamonds, indicated in excess of 2 million carats recoverable with an
in-situ value of US$211 million and recommended an open/vertical pit mining
operation, setting the life of mine at over nine years with payback by year two,
an IRR of 55 per cent and an NPV (at 8 per cent) of US$39.1 million.
With the permitting process behind us, the focus of the Company's efforts on
this project throughout the year has been on securing appropriate strategic or
partnership finance to take Lahtojoki through the development stage and on to
production. Those discussions have continued throughout the year and remain
ongoing. I do not expect this to be a straightforward process in the current
market, but with the presence of fancy diamonds, including pink diamonds, and
with the potential for the mine to act as a hub for other developments in the
region, I continue to believe that the Company represents an attractive
proposition as the first diamond mine in the European Union.
While market sentiment towards the diamond sector has remained challenging from
an investment perspective, the Company's view is that in a global market segment
for natural diamonds worth over US$29 billion annually, sustainably produced and
fully traceable European diamonds will command a premium. That premium would be
further supported by the potential of the Company's assets to produce coloured
diamonds. The Company has therefore concentrated on carefully progressing its
exploration work so as to position itself well for a recovery in retail
sentiment towards natural stones.
Diamond Exploration in the Kuhmo Region
The Company's principal exploration focus in Finland during the year was the
geophysical target designated Anomaly 5, which lies up-ice of the green diamond
discovered by the Company in glacial till and carries a near-source kimberlite
indicator mineral signature. The target was identified from a semi-airborne
electromagnetic survey carried out by the Company and announced in January 2025.
During the winter weather window a three-hole drilling programme totalling
approximately 334 metres was completed at Anomaly 5, in a swampy area accessible
only in winter conditions. Beneath an exceptionally thick overburden of some 35
metres, two of the three holes intersected rock material provisionally
interpreted as olivine lamproite, a rock type associated with diamond-bearing
provinces globally, including the world-class Argyle and Ellendale diamond
mines. Hole KD-26-02 intersected an eight metre interval at a depth of
approximately 73.40 to 81.40 metres, and hole KD-26-03 a 3.9 metre interval at
approximately 42.90 to 46.80 metres, the latter encountering highly weathered
olivine lamproite directly from the bedrock surface. All of the olivine
lamproite intersected occurs as breccia and is highly altered. The programme
concluded earlier than planned owing to the early onset of the spring thaw.
Diagnostic rock types recorded in the core indicate that the drilling to date
has been on the periphery of a larger intrusive system, and the discovery of
several picroilmenite xenocrysts within the altered lamproite provides strong
evidence that this, or a closely related intrusion, may be the source of the
Anomaly 5 indicator mineral train. Drill core samples are being prepared for
detailed petrographic and geochemical analysis in order to classify the material
formally and to assess its diamond-bearing potential.
The next steps will include a limited ground electromagnetic survey, which will
allow for more accurate drill targeting once conditions permit mobilisation of a
rig. A test hole beneath the lake within the Anomaly 5 target, which lies at the
head of the kimberlite indicator mineral train and has yet to be tested, will be
a priority. Continued work on this project is warranted by the exceptional
compositions of the mantle minerals in the Anomaly 5 indicator mineral train,
which are indicative of sampling from a wide diamond window in the mantle, and
by the green diamond discovery itself.
The Company also conducted a review during the year of its wider exploration
asset base in the Kuhmo area, which includes the diamondiferous Seitaperä
kimberlite (olivine lamproite), Finland's largest known pipe at approximately
6.9 hectares, and the kimberlite (olivine lamproite) discovery at Riihivaara.
The exploration permits covering these are held until a minimum of Q1 2027. The
various licences in the Kuhmo area interlink and cover an area which has the
potential to become a significant diamond province on the Finnish side of the
Karelian Craton, using a potential development at Lahtojoki as a production hub.
Nickel, Copper and Platinum Group Elements in Northern Ireland
The Company holds a significant licence package covering over 1,000 km² in
Northern Ireland, where it has established first mover advantage and has
continued to advance its exploration programme for nickel, copper and platinum
group elements throughout the year under review. This work builds on the
assessment carried out by Dr. Larry Hulbert, the geological consultant first
engaged by the Company in early 2024, whose report confirmed the significant
potential of the licence areas for these base and precious metals and
recommended a follow-up work programme. Dr. Hulbert's work included the
construction of a comprehensive database incorporating geology, geochemistry,
geophysics, remote sensing and base gravity geophysical data.
In June 2025 the Company announced that it had identified the site of the
historic Cappagh Copper Mine as a significant new copper target for
investigation within its KDR4 licence area. Initial desk-based studies and
reconnaissance work highlighted the area as a promising target, and it provides
the Company with a tangible copper target in addition to those identified in Dr.
Hulbert's report, further enhancing the Company's strategic position in Northern
Ireland. Exploration programmes have been planned which will commence with
detailed geological mapping and geochemical sampling.
In late 2025 the Company entered into an enterprise partnership with Trinity
College Dublin in respect of a work programme, jointly funded by Research
Ireland, to be carried out on the platinum group element potential of the
Company's licence areas over the coming years. The Board regards this
partnership as an efficient means of advancing the technical understanding of
the licence package alongside the Company's own field programmes.
Environmental, Social and Governance Issues
Great emphasis is placed by the Company on these issues, and the Company is
committed to high standards of corporate governance and integrity in all its
activities and operations, including rigorous health and safety compliance,
environmental consciousness and the promotion of a culture of good ethical
values and behaviour.
Financial Review
The Company recorded a loss for the financial year ended 31 May 2026 of €529,413
(31 May 2025: loss of €279,357). At 31 May 2026 the Company had total assets of
€12,463,641 (31 May 2025: €12,246,037) and net assets at the same date of
€9,820,103 (31 May 2025: €10,141,861). Intangible assets, comprising exploration
and evaluation assets, carried on the statement of financial position at 31 May
2026 amounted to €12,358,754 (31 May 2025: €12,085,967).
In June 2025 the Company raised €217,239 (£185,000) before share issue costs by
way of a placing and subscription of 24,666,666 new ordinary shares at an issue
price of 0.75 pence per share. In March 2026 the Company raised a further
€336,234 (£290,000) through the issue of unsecured convertible loan notes to a
combination of new investors and existing shareholders. The convertible loan
notes have a three year term, are unsecured and unlisted, carry interest at 8
per cent per annum and are convertible at a price of 1.5 pence per share, a
premium of 300 per cent to the closing mid-market price of 0.375 pence per
ordinary share on 19 March 2026. That both new and existing investors were
prepared to subscribe at such a premium is, in the Board's view, a very positive
endorsement of the Company.
I would like once again to place on record my appreciation of the continued
support shown by both current and former directors in deferring amounts owed to
them in respect of salaries and directors' fees. The Board has been working on a
plan to restructure these amounts so as to align their settlement with the
future success of the Company.
Directors and Staff
I would like to take this opportunity to sincerely thank my fellow directors,
staff and consultants for their work and contribution to the Company and its
operations over the past year. Their support and commitment are greatly
appreciated and have contributed significantly to the Company's progress.
Outlook
The Company has entered the new financial year with its mining rights at
Lahtojoki secured, a first set of encouraging drill results from Anomaly 5, and
a clear work programme for its highly prospective nickel, copper and platinum
group element targets in Northern Ireland. The immediate priorities are to
complete the analytical work on the Anomaly 5 core and to define the follow-up
drill targets, to commence field exploration on the Cappagh copper target and
the wider Northern Ireland licence package, and to continue the search for an
industry-focused partner to advance Lahtojoki to development. The Board remains
confident regarding the prospects for the Company.
Brendan McMorrow
Chairman
4 November 2026
Extract from Independent Auditor's Report
Material uncertainty related to going concern
In auditing the financial statements, we have concluded that the directors' use
of the going concern basis of accounting in the preparation of the financial
statements is appropriate.
We draw attention to note 1, under the `Going Concern' section, in the financial
statements, which indicates that the Company has net current liabilities of
€2,540,236 as of 31 May 2026 and there is a requirement to raise funds to carry
out the Company's plans.
As stated in note 1, these events or conditions, along with other matters as set
forth in note 1, indicate that a material uncertainty exists that may cast
significant doubt on the Company's ability to continue as a going concern. Our
opinion is not modified in respect of this matter.
Our evaluation of the directors' assessment of the Company's ability to continue
to adopt the going concern basis of accounting included:
· obtaining an understanding of the Company's relevant controls over the
preparation of cash flow forecasts and approval of the projections and
assumptions used in cash flow forecasts to support the going concern assumption;
· evaluating the design and determining the implementation of these relevant
controls;
· evaluating directors' plans and their feasibility by reviewing the
reasonableness of the inputs used in the cash flow forecasts to expenditure
commitments and other supporting documentation;
· challenging the reasonableness of the assumptions applied by the directors
in their going concern assessment;
· obtaining confirmations, received by the Company, from the directors and
former directors evidencing that they will not seek repayment of amounts owed to
them by the Company within 12 months of the date of approval of the financial
statements, unless the Company has sufficient funds to repay;
· assessing the mechanical accuracy of the cash flow forecast model; and
· assessing the accuracy and completeness of the relevant disclosures made in
the financial statements.
Our responsibilities and the responsibilities of the directors with respect to
going concern are described in the relevant sections of this report.
Statement of profit or loss
For the year ended 31 May 2026
Note 2026 2025
€ €
Continuing operations
Operating expenses 2 (366,813) (364,615)
Operating loss (366,813) (364,615)
Fair value movement in warrants in issue 11 (58,972) 91,738
Interest expense 11,12 (12,825) (6,480)
Fair value movement in conversion option 11 (90,803) -
Total finance costs (162,600) 85,258
Loss before taxation 3 (529,413) (279,357)
Income tax expense 5 - -
Loss for the financial year (529,413) (279,357)
Loss per share
Basic and diluted loss per share 6 (0.0027) (0.0020)
The total loss for the financial year is entirely attributable to equity holders
of the Company.
Statement of comprehensive income
For the year ended 31 May 2026
2026 2025
€ €
Loss for the financial year (529,413) (279,357)
Income recognised in other comprehensive income - -
Total comprehensive income for the financial year (529,413) (279,357)
The total comprehensive income for the financial year is entirely attributable
to equity holders of the Company.
Statement of financial position
as at 31 May 2026
31 May 31 May
Note 2026 2025
€ €
Assets
Non-current assets
Intangible assets 7 12,358,754 12,085,967
Tangible Assets 1,585 2,114
Total non-current assets 12,360,339 12,088,081
Current assets
Cash and cash equivalents 9 47,591 40,862
Other receivables 10 55,711 117,094
Total current assets 103,302 157,956
Total assets 12,463,641 12,246,037
Equity
Capital and reserves
Share capital presented as equity 13 3,226,368 3,220,201
Share premium 13 11,601,317 11,399,829
Share-based payments reserve 13 450,658 450,658
Other reserve 11 - -
Retained deficit (5,458,240) (4,928,827)
Total equity 9,820,103 10,141,861
Liabilities
Non-current liabilities
Warrant liabilities 11,16 - 32,880
Total non-current liabilities - 32,880
Current liabilities
Trade and other payables 12 1,970,978 1,928,790
Convertible loan 12 138,682 132,202
Derivative liability 12 10,304 10,304
Warrant liabilities 11,16 91,852 -
Convertible loan notes 11 308,648 -
Derivative liability - conversion option 11 123,074 -
Total current liabilities 2,643,538 2,071,296
Total liabilities 2,643,538 2,104,176
Total equity and liabilities 12,463,641 12,246,037
Statement of changes in equity
for the financial year ended 31 May 2026
Share Share Share Other Retained Total
premium -based reserve deficit equity
capital payment
reserve
Note € € € € € €
Balance 3,220,201 11,399,829 450,658 - (4,928,827) 10,141,861
at 1
June 2025
Share 13 6,167 211,072 - - - 217,239
issue
Share 13 - (9,584) - - - (9,584)
issue
costs
Loss for - - - - (529,413) (529,413)
the
financial
year
Balance 3,226,368 11,601,317 450,658 - (5,458,240) 9,820,103
at 31
May 2026
Balance 3,203,532 10,736,889 450,658 - (4,649,470) 9,741,609
at 1
June 2024
Share 13 16,669 789,422 - - - 806,091
issue
Share 16 - (126,482) - - - (126,482)
issue
costs
Loss for - - - - (279,357) (279,357)
the
financial
year
Balance 3,220,201 11,399,829 450,658 - (4,928,827) 10,141,861
at 31
May 2025
Share capital
The share capital comprises of the nominal value share capital issued for cash
and non-cash consideration. The share capital also comprises deferred share
capital. The deferred share capital arose through the restructuring of share
capital which was approved at the Annual General Meeting held on 9 December
2016. A detailed breakdown of the share capital figure is included in Note 13.
Share premium
The share premium reserve comprises of the excess consideration received in
respect of share capital over the nominal value of shares issued net of any
direct share issue costs which are deducted from share premium in line with the
Company's accounting policies. The fair value of warrants issued as part of a
fundraise are included in direct share issue costs (see Note 16). There were no
warrants issued as part of the funds raised in the current financial year (the
fair value of warrants issued in the year ending 31 May 2025 was €94,512).
Share-based payment reserve
The share-based payment reserve comprises the cumulative fair value of equity
-settled share options and warrants granted in consideration for goods or
services received, recognised over the relevant vesting periods, net of amounts
relating to options and warrants forfeited or lapsed, which are transferred to
the retained deficit. There was no movement in the reserve during the year or in
the preceding year. Warrants issued in connection with equity fundraisings are
transactions with investors acting in their capacity as holders of equity
instruments and fall outside the scope of IFRS 2; accordingly no amount in
respect of such warrants is recognised in this reserve.
Retained deficit
This reserve represents the accumulated losses absorbed by the Company to the
statement of financial position date.
Statement of cash flows
for the financial year ended 31 May 2026
2026 2025
€ €
Cash flows from operating Note
activities
Loss for the financial year (529,413) (279,357)
Adjustments for:
Depreciation 529 -
Movement in fair value of 11 58,972 (91,738)
warrants
Movement in fair value of 11 90,803 -
conversion option
Interest expense 11,12 12,825 6,480
Foreign exchange gain on 11 (1,660) -
convertible loan notes
(367,944) (364,615)
Increase in trade and other 12 42,188 25,189
payables
Decrease / (increase) in 10 61,383 (35,543)
other receivables
Net cash (used in) / from (264,373) (374,969)
operating activities
Cash flows from investing
activities
Expenditure on intangible 7 (272,787) (395,773)
assets
Purchase of tangible assets - (2,114)
Net cash used in investing (272,787) (397,887)
activities
Cash flows from financing
activities
Proceeds on issue of share 13 217,239 774,121
capital
Share issue costs 13 (9,584) -
Proceeds from issue of 11 336,234 -
convertible loan notes
Net cash provided by 543,889 774,121
financing activities
Increase in cash and cash 6,729 1,265
equivalents
Cash and cash equivalents at 40,862 39,597
beginning of financial year
Cash and cash equivalents at 47,591 40,862
end of financial year
Notes to the financial statements for the financial year ended 31 May 2026
1 Material accounting policies
Reporting entity
Karelian Diamond Resources P.L.C. (the "Company") is a company domiciled in
Ireland. The Company is a public limited company incorporated in Ireland under
registration number 382499. The registered office is located at Shannon Airport
House, Shannon Free Zone, Shannon, Co. Clare, V14E370, Ireland. The principal
activity of the Company during the financial year is mineral exploration and
development.
Basis of preparation
The financial statements are presented in euro ("€"). The euro is the functional
currency of the Company. The financial statements are prepared under the
historical cost basis except for derivative financial instruments which are
measured at fair value at each reporting date. The preparation of financial
statements requires the Board of Directors and management to use judgements,
estimates and assumptions that affect the application of policies and reported
amounts of assets, liabilities, income and expenses. Actual results may differ
from those estimates. 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 and in any future periods affected. Details of
significant judgements are disclosed in the accounting policies.
The financial statements were authorised for issue by the Board of Directors on
4 November 2026.
Going concern
In preparing the financial statements, the directors consider it appropriate to
use the going concern assumption, which assumes the company will have sufficient
resources to enable it to meet its liabilities as they fall due. The Company
recorded a loss of €529,413 (31 May 2025: loss of €279,357) for the financial
year ended 31 May 2026. The Company had net assets of €9,820,103 (31 May 2025:
€10,141,861) at that date. The Company had net current liabilities of €2,540,236
(31 May 2025: €1,913,340) at that date. Net current liabilities include €431,722
(31 May 2025: €Nil) in respect of the convertible loan notes and the related
conversion option, which are presented as current because the holders may
convert at any time; no cash repayment of the notes falls due before 20 March
2029. The Company had cash and cash equivalents of €47,591 (31 May 2025:
€40,862) at 31 May 2026. As set out in the Chairman's statement, the Company
expects to incur capital expenditure in 2026 and 2027, consistent with its
strategy as an exploration company.
The Directors have considered carefully the financial position of the Company
and in that context, have prepared and reviewed cash flow forecasts for the
period to 31 December 2027. In doing so, the Directors are mindful of the risks
faced by the business including in particular general industry risks facing
companies in the natural resource sector as described in the Directors Report.
The Board of Directors are experienced at managing the peaks and troughs of
investor sentiment in the natural resources industry and will continue to manage
the cashflows of the Company including planning/revising work programmes
according to available funds. The Company continues to rely on its ability to
raise appropriate finance through either asset level investment or fresh issues
of share capital and the support of its Directors in relation to amounts owing
to them to meet its liabilities as they fall due. In this context the Board of
Directors note that all directors, namely, Brendan McMorrow, Maureen T.A.
Jones, Howard Bird and Dr. Sorċa Conroy, and former Directors namely James P.
Jones, Seamus P. FitzPatrick and the Estate of Professor Richard Conroy, have
confirmed that they will not seek repayment of amounts owed to them by the
Company of €1,700,163 (31 May 2025: €1,614,886) for a minimum period of 12
months from the date of approval of the financial statements, unless the Company
has sufficient funds to repay.
The Directors recognise that net current liabilities of €2,540,236 (31 May 2025:
€1,913,340), of which €1,700,163 due to Directors and former Directors has been
deferred for a minimum period of 12 months from the date approval of the
financial statements, coupled with the requirement to raise funds to carry out
the Company's plans is a material uncertainty that may cast significant doubt on
the Company's ability to continue as a going concern and, therefore that it may
be unable to realise its assets and discharge its liabilities in the normal
course of business. The cashflows include plans to raise funds to carry out the
activities of the company and the Board of Directors are confident that adequate
funds can be raised through strategic partnerships or direct market fundraising
to meet their objectives.To mitigate the risk of the timing and scale of
investment not being met, the Board and management continue to take actions to
monitor and manage the cost base and project implementation plans as
appropriate.
In reviewing both the current work programme commitments and proposed work
programmes for exploration and evaluation assets (which will be dependent on the
quantum of funds raised), the results obtained from past and ongoing exploration
programmes, the support noted above from the Board (and past Board members) and
the prospects for raising additional funds as required, the Board of Directors
are satisfied that it is appropriate to prepare the financial statements on a
going concern basis.
The financial statements do not include any adjustments to the carrying value
and classification of assets and liabilities that would arise if the Company was
unable to continue as going concern.
Statement of compliance
The Company's financial statements have been prepared in accordance with IFRS
Accounting Standards as issued by the International Accounting Standards Board
(IASB) and as adopted by the European Union ("the relevant financial reporting
framework") and the requirements of the Companies Act 2014.
Recent accounting pronouncements
(i) New and amended standards adopted by the Company
The Company has adopted the following amendments to standards for the first time
for its annual reporting year commencing 1 June 2025:
· Amendments to IAS 21 The Effects of Changes in Foreign Exchange Rates: Lack
of Exchangeability - Effective date 1 January 2025.
The adoption of the above amendments to standards had no significant impact on
the financial statements of the Group and the Company.
(ii) New standards and interpretations not yet adopted by the Company
Certain new accounting standards and interpretations have been published and
endorsed by the EU that are not mandatory for 31 May 2026 reporting periods and
have not been early adopted by the Company. The Board of Directors does not
consider that those of the below that will be effective for the year ended 31
May 2027 will have a material effect on the financial statements and it is
considering whether or not those that become effective in the following
financial year will have any impact on the financial statements.
· Amendments to IFRS 9 and IFRS 7 regarding classification and measurement of
financial instruments - Effective date 1 January 2026;
· Annual Improvements to IFRS Accounting Standards - Volume 11 - Effective
date 1 January 2026;
· Amendments to IFRS 9 and IFRS 7 regarding contracts referencing nature
-dependent electricity - Effective date 1 January 2026;
· IFRS 18 Presentation and Disclosure in Financial Statements - Effective date
1 January 2027.
The following new standards and amendments to standards have been issued by the
International Accounting Standards Board but have not yet been endorsed by the
EU, accordingly, none of these standards have been applied in the current year.
The Board of Directors is currently assessing whether these standards if
endorsed by the EU will have any impact on the financial statements of the
Company.
· Amendments to IAS 21 The Effects of Changes in Foreign Exchange Rates:
Translation to a Hyperinflationary Presentation Currency - Effective date 1
January 2027;
· IFRS 19 Subsidiaries without Public Accountability: Disclosures - Effective
date 1 January 2027;
· Amendments to the Fair Value Option in IAS 28 Investments in Associates and
Joint Ventures - Effective date 1 January 2027;
· IFRS 20 Regulatory Assets and Regulatory Liabilities - Effective date 1
January 2029.
· Amendments to the Fair Value Option in IAS 28 Investments in Associates and
Joint Ventures - Effective date 1 January 2027
(a) Intangible assets
The Company accounts for mineral expenditure in accordance with IFRS 6:
Exploration for and Evaluation of Mineral Resources.
(i) Capitalisation
All costs related to acquiring the legal rights to explore will be capitalised.
All other costs incurred prior to acquiring the rights to explore are charged
directly to the statement of profit or loss. Exploration, appraisal and
development expenditure incurred on exploring, and testing exploration prospects
are accumulated and capitalised as intangible exploration and evaluation ("E&E")
assets.
E&E capitalised costs include geological and geophysical costs, and other direct
costs of exploration (drilling, trenching, sampling and technical feasibility
and commercial viability activities). In addition, E&E capitalised costs include
an allocation from operating expenses and wages and salaries where they apply to
activities in relation to evaluating the technical feasibility and commercial
viability of extracting a mineral resource .
E&E capitalised costs are not amortised prior to the conclusion of appraisal
activities.
At completion of appraisal activities if technical feasibility is demonstrated
and commercial resources are discovered, then the carrying amount of the
relevant E&E asset will be reclassified as a development and production asset,
once the carrying value of the asset has been assessed for impairment. If
following completion of appraisal activities in an area, it is not possible to
determine technical feasibility and commercial viability, or if the right to
explore expires, then the costs of such unsuccessful exploration and evaluation
are written off to the statement of profit or loss in the period in which the
event occurred.
(ii) Impairment
If facts and circumstances indicate that the carrying value of an E&E asset may
exceed its recoverable amount, an impairment review is performed. The following
are considered to be key indicators of impairment in relation to E&E assets:
· The period for which the entity has the right to explore in the specific
area has expired or will expire in the near future and is not expected to be
renewed.
· Substantive expenditure on further exploration for and evaluation of mineral
resources in the specific area is neither budgeted nor planned.
· Exploration for and evaluation of mineral resources in the specific area
have not led to the discovery of commercially viable quantities of mineral
resources and the entity has decided to discontinue such activities in the
specific area.
· Sufficient data exists to indicate that, although a development in the
specific area is likely to proceed, the carrying amount of the exploration and
evaluation asset is unlikely to be recovered in full from successful development
or by sale.
For E&E assets, where the above indicators exist on an annual basis, an
impairment test is carried out. The E&E assets are categorised into Cash
Generating Units ("CGU") on a country-by-country (where material) basis. The
carrying value of the CGU is compared to its recoverable amount and any
resulting impairment loss is written off to the statement of profit or loss. The
recoverable amount of the CGU is assessed as the higher of its fair value, less
costs to sell, and its value in use.
(b) Income taxation expense
Income tax expense comprises current and deferred tax. Income tax expense is
recognised in the statement of profit or loss except to the extent that it
relates to items recognised directly in other comprehensive loss, in which case
it is recognised in the statement of comprehensive income. Current tax is the
expected tax payable on the taxable income for the year, using tax rates enacted
or substantively enacted at the reporting date, and any adjustment to tax
payable in respect of previous years.
Deferred tax is the tax expected to be payable or recoverable on differences
between the carrying amounts of assets and liabilities in the financial
statements and the corresponding tax bases used in the computation of taxable
profit and is accounted for using the liability method. Deferred tax liabilities
are generally recognised for all taxable temporary differences and deferred tax
assets are recognised to the extent that it is probable that taxable profits
will be available against which deductible temporary differences can be
utilised.
(c) Share-based payments
The Company classifies instruments issued as financial liabilities or equity
instruments in accordance with the substance of the contractual terms of the
instruments. When the warrants issued (see Note 16 for details) have an exercise
price in sterling, they are derivative in nature and are liability classified.
They do not qualify for equity classification as any cash settlement on exercise
of these warrants will be received in a foreign currency. Where warrants are
issued in the functional currency of the Company and meet the other necessary
conditions, they are recognised as equity instruments. The warrant liabilities
are recognised at their fair value on initial recognition and subsequently are
measured at fair value through statement of profit or loss. Any incremental
direct costs associated with the issuance of warrants are taken as an immediate
charge to finance costs through the statement of profit or loss. See Notes 11
and 16 for further details.
For equity-settled share-based payment transactions (i.e. the granting of share
options and share warrants), the Company measures the services and the
corresponding increase in equity at fair value at the measurement date (which is
the grant date) using a recognised valuation methodology for the pricing of
financial instruments (Binomial Lattice Model or Black Scholes Model). See also
policy (k).
(d) Trade and other receivables and payables
Trade and other receivables are measured at their transaction price and
subsequently measured at amortised cost. Trade and other payables are measured
at initial recognition at fair value and subsequently measured at amortised
cost.
(e) Earnings per share
The Company presents basic and diluted earnings per share ("EPS") data for its
ordinary shares. Basic EPS is calculated by dividing the profit or loss
attributable to ordinary shareholders by the weighted average number of ordinary
shares outstanding during the period. Diluted EPS is determined by adjusting the
profit attributable to ordinary shareholders and the weighted average number of
ordinary shares outstanding for the effects of all potentially dilutive ordinary
shares.
(f) Cash and cash equivalents
Cash and cash equivalents consist of cash at bank held by the Company and short
-term bank deposits with a maturity of three months or less. Cash and cash
equivalents are held for the purpose of meeting short-term cash commitments.
(g) Pension costs
The Company provides for pensions for certain employees through a defined
contribution pension scheme. The amount charged to the statement of profit or
loss is the contribution payable in that financial year. Any difference between
amounts charged and contributions paid to the pension scheme is included in
receivables or payables in the statement of financial position.
(h) Foreign currencies
Transactions denominated in foreign currencies relating to costs and non
-monetary assets are translated into euro at the rates of exchange ruling on the
dates on which the transactions occurred. Monetary assets and liabilities
denominated in foreign currencies are translated into euro at the rate of
exchange ruling at the statement of financial position date. The resulting
profits or losses are dealt with in the statement of profit or loss .
(i) Directors' Loans
Directors' loans are initially measured at fair value, net of transaction costs
and subsequently measured at amortised cost using the effective interest method,
with interest expense recognised on the effective interest rate method. The
effective interest method is a method of calculating the amortised cost of a
financial liability and of allocating interest expense over the relevant period.
The effective interest rate is the rate that exactly discounts estimated future
cash payments through the expected life of the financial liability.
(j) Convertible loan
The convertible loan notes are denominated in sterling, which is not the
Company's functional currency. Conversion would therefore be for a variable
amount of euro and the conversion option does not meet the fixed-for-fixed
requirement of IAS 32 for classification as equity. The conversion option is
accordingly accounted for as an embedded derivative, separated from the host
debt contract in accordance with IFRS 9. At initial recognition, the conversion
option is measured at fair value and the host debt is the residual of the
proceeds after deducting that fair value. Both the host debt and the derivative
are recognised as liabilities in the statement of financial position. The
conversion feature is subsequently measured at fair value with changes
recognised in profit or loss. The liability is subsequently measured at
amortised cost. The Company accounts for the interest expense of the convertible
loan note at the effective interest rate. The difference between the effective
interest rate and interest rate attached to the convertible loan increases the
carrying amount of the liability so that, on maturity, the carrying amount is
equal to the cash repayment that the Company may be required to pay.
(k) Ordinary shares
Ordinary shares are classified as equity. Costs directly attributable to the
issue of ordinary shares are recognised as a deduction from share premium, net
of any tax effects. Where warrants are issued for the sole purpose of assisting
with an issue of equity or to meet broker transaction costs directly
attributable to the issue of equity, the amount initially recognised, that is
their fair value, is deducted from share premium. Subsequently, where the
warrants qualify as equity they are recognised in other reserves and the amount
recognised is not changed. If the warrants qualify as a liability the fair
value is trued up from one reporting period to the next through profit or loss.
(l) Impairment - financial assets are measured at amortised cost
Financial assets measured at amortised cost are reviewed for impairment loss at
each reporting date.
The Company measures the loss allowance at an amount equal to the lifetime
expected credit losses ("ECL") as required under a simplified approach for
receivables that do not contain a financing component. The Company's approach to
ECL reflects a probability-weighted outcome, the time value of money and
reasonable and supportable information that is available without undue cost or
effort at the reporting date about past events, current conditions and forecasts
of future economic conditions. Significant financial difficulties of the
counterparty, probability that the counterparty will enter bankruptcy or
financial re-organisation and default in payments are all considered indicators
for increases in credit risks. If the credit risk increases to the point that it
is considered to be credit impaired, interest income will be calculated based on
the gross carrying amount adjusted for the loss allowance. Any contractual
payment which is more than 90 days past due is considered credit impaired.
(m) Financial instruments
Recognition and derecognition
Financial assets and financial liabilities are recognised when the Company
becomes a party to the contractual provisions of the financial instrument.
Financial assets are derecognised when the contractual rights to the cash flows
from the financial asset expire, or when the financial asset and substantially
all the risks and rewards are transferred. A financial liability is derecognised
when it is extinguished, discharged, cancelled or expires.
Classification and initial measurement of financial assets
Except for those trade receivables that do not contain a significant financing
component and are measured at the transaction price in accordance with IFRS 15,
all financial assets are initially measured at fair value adjusted for
transaction costs (where applicable).
Impairment of financial assets
IFRS 9's impairment requirements use forward-looking information to recognise
expected credit losses - the `expected credit loss (ECL) model'. Instruments
within the scope of the requirements included loans and other debt-type
financial assets measured at amortised cost and FVOCI, trade receivables,
contract assets recognised and measured under IFRS 15 and loan commitments and
some financial guarantee contracts (for the issuer) that are not measured at
fair value through profit or loss. The Company considers a broader range of
information when assessing credit risk and measuring expected credit losses,
including past events, current conditions, reasonable and supportable forecasts
that affect the expected collectability of the future cash flows of the
instrument.
Subsequent measurement of financial assets
Financial assets held within a different business model to `hold to collect' or
`hold to collect and sell' are categorised at FVTPL. Further, irrespective of
the business model used, financial assets whose contractual cash flows are not
solely payments of principal and interest are accounted for at FVTPL. All
derivative financial instruments fall into this category, except for those
designated and effective as hedging instruments, for which the hedge accounting
requirements apply (see below). The category also contains an equity investment.
The Company accounts for the investment at FVTPL and did not make the
irrevocable election to account for the listed equity securities at FVOCI. The
fair value was determined in line with the requirements of IFRS 13 `Fair Value
Measurement'. Assets in this category are measured at fair value with gains or
losses recognised in profit or loss.
The fair values of financial assets in this category are determined by reference
to active market transactions or using a valuation technique where no active
market exists.
Classification and measurement of financial liabilities
The Company's financial liabilities include trade and other payables and
derivative financial instruments. Financial liabilities are initially measured
at fair value, and, where applicable. Subsequently, financial liabilities are
measured at amortised cost using the effective interest method except for
derivatives and financial liabilities designated at FVTPL, which are carried
subsequently at fair value with gains or losses recognised in profit or loss
(other than derivative financial instruments that are designated and effective
as hedging instruments). All interest-related charges and, if applicable,
changes in an instrument's fair value that are reported in profit or loss are
included within finance costs or finance income.
(n) Tangible assets
Tangible assets, comprising plant and office equipment and computer equipment,
are stated at historical cost less accumulated depreciation and any provision
for impairment. Depreciation is charged to the statement of profit or loss on a
straight line basis over the estimated useful life of each asset, with nil
residual value. The rate applied to computer equipment is 25% per annum, being
an estimated useful life of four years. The useful lives and residual values of
tangible assets are reviewed at each reporting date and adjusted where
appropriate.
(o) Significant accounting judgements and key sources of estimation uncertainty
Significant judgements in applying the Company's accounting policies
The preparation of the financial statements requires the Board of Directors to
make judgements and estimates and form assumptions that affect the amounts of
assets, liabilities, contingent liabilities, revenues and expenses reported in
the financial statements. On an ongoing basis, the Board of Directors evaluates
its judgements and estimates in relation to assets, liabilities, contingent
liabilities, revenue and expenses. The Board of Directors bases its judgements
and estimates on historical experience and on other factors it believes to be
reasonable under the circumstances, the results of which form the basis of the
reported amounts that are not readily apparent from elsewhere in the financial
statements. Actual results may differ from these estimates where the underlying
assumptions and conditions change over time. In the process of applying the
Company's accounting policies above, the Board of Directors have identified the
judgemental areas that have the most significant impact on the amounts
recognised in the financial statements (apart from those involving estimations),
which are dealt with as follows:
Exploration and evaluation assets
The assessment of whether operating costs and salary costs are capitalised to
exploration and evaluation costs or expensed involves judgement. The Board of
Directors consider the nature of each cost incurred and whether it is deemed
appropriate to capitalise it within exploration and evaluation assets. Given
that the activity of management and the resultant administration and salary
costs are primarily focused on the Company's diamond prospects, the Board of
Directors consider it appropriate to capitalise a portion of such costs. These
costs are reviewed on a line-by-line basis with the resultant calculation of the
amount to be capitalised being specific to the activities of the Company in any
given year.
Cash generating units ("CGUs")
As outlined in the intangible assets accounting policy, the exploration and
evaluation assets should be allocated to CGUs. The determination of what
constitutes a CGU requires judgement. The Board of Directors consider its
diamond licences in the Kuhmo region of Finland to be one CGU and its copper /
nickel / platinum group element licences in Northern Ireland to be a separate
CGU.
The carrying value of each CGU is compared to its recoverable amount. The
recoverable amount of the CGU is assessed as the higher of its fair value less
costs to sell and its value in use. The determination of value in use requires
the following judgements:
· Estimation of future cash flows expected to be derived from the asset.
· Expectation about possible variations in the amount or timing of the future
cash flows.
· The determination of an appropriate discount rate.
Going concern
The preparation of financial statements requires an assessment on the validity
of the going concern assumption. The validity of the going concern assumption is
dependent on the successful further development and ultimate production of the
mineral resources and the availability of sufficient finance to bring the
resources to economic maturity and profitability. The Board of Directors have
reviewed the proposed programme for exploration and evaluation assets and, on
the basis of the results from the exploration programme and the prospects for
raising additional funds as required, consider it appropriate to prepare the
financial statements on the going concern basis. Refer to page 30 for further
details.
Deferred tax
No deferred tax asset has been recognised in respect of unused tax losses as
there is insufficient certainty that future taxable profits will be available
against which these unused losses can be utilised.
Classification of the convertible loan notes
The convertible loan notes issued on 20 March 2026 are denominated in sterling,
whereas the Company's functional currency is euro. The Board of Directors has
concluded that the conversion option therefore fails the IAS 32 fixed-for-fixed
test and is classified as a derivative liability measured at fair value through
profit or loss, rather than as equity. As the holders may convert at any time,
both the host debt and the derivative liability are classified as current
liabilities (Note 11). The loan notes are accounted for as a host debt liability
and an embedded derivative liability. The host debt liability is subsequently
measured at amortised cost and the embedded derivative liability is subsequently
measured at fair value through profit or loss.
Key sources of estimation uncertainty
The key sources of estimation uncertainty that have a significant risk of
causing material adjustment to the carrying amounts of assets and liabilities
within the next financial year are discussed below.
Exploration and evaluation assets
The carrying value of exploration and evaluation assets in the statement of
financial position was €12,358,754 (31 May 2025: €12,085,967) at 31 May 2026
(Note 7). The Board of Directors carried out an assessment, in accordance with
IFRS 6: Exploration for and Evaluation of Mineral Resources relating to
likelihood of licence renewal, likelihood of further expenditure, possible
discontinuation of activities over specific claims and available data which may
suggest that the recoverable value of an exploration and evaluation asset is
less than its carrying amount. This assessment included an assessment of the
likelihood of securing a future strategic investment or joint venture partner to
assist with the development of the assets. The granting, of a mining permit in
Lahtojoki region was received in June 2025, provides the opportunity to progress
the development of a central processing hub for its exploration assets in the
Kuhmo region. Having considered the prospects for both development of its
diamond deposit and further exploration success in its licence area, the Board
of Directors is satisfied as to the carrying value of these assets and is
satisfied that these are recoverable, acknowledging however that their
recoverability is dependent on future successful exploration efforts.
Fair value of the conversion options
The conversion option attaching to the convertible loan notes is measured at
fair value using the Black-Scholes model, a Level 3 measurement. The carrying
amount at 31 May 2026 was €123,074 (31 May 2025: Nil). The valuation is
sensitive to share price volatility and to the Company's share price; the inputs
and sensitivities are set out in Note 11.
Employee benefits - Share-based payment transactions
The Company operates equity-settled share-based payment arrangements with non
-market performance conditions which fall within the scope of and are accounted
for under the provisions of IFRS 2: Share-based Payment. Accordingly, the grant
date fair value of the options under these schemes is recognised as an operating
expense with a corresponding increase in the "Share-based payment reserve",
within equity, where the exercise price is granted in euro or recognised as a
liability where a different currency is quoted as the exercise price over the
vesting period. The estimation of share-based payment costs requires the
selection of an appropriate valuation model and consideration as to the inputs
necessary for the valuation model chosen. The Company has made estimates as to
the volatility of its own shares, the probable life of options granted and the
time of exercise of those options. The model used by the Company is the Black
Scholes Model. The fair value of these options is measured using an appropriate
option pricing model, taking into account the terms and conditions upon which
the options were granted. The amount recognised as an expense is adjusted to
reflect the actual number of share options that vest, except where forfeiture is
only due to share prices not achieving the threshold for vesting.
2 Operating expenses
2026 2025
Analysis of operating expenses € €
Operating expenses 505,171 531,151
Transfer to intangible assets (138,358) (166,536)
366,813 364,615
Operating expenses are analysed as follows:
Professional fees 183,963 183,220
Wages and salaries 143,370 180,109
Directors' Fees 50,000 60,833
Other operating expenses 82,838 65,489
Auditor's remuneration 45,000 41,500
505,171 531,151
Other operating expenses consisted mainly of insurance, stock exchange fees,
rent and printing and postage costs.
Of the above costs, a total of €138,358 (31 May 2025: €166,536) is capitalised
to intangible assets based on a review of the nature and quantum of the
underlying costs. Refer to Note 1(a)(i) for further details. The costs
capitalised to intangible assets mainly relate to the costs of geological and on
-site personnel together with travel and substance costs directly attributable
to exploration activities and part of the Managing Director's salary which meets
the criteria's as per the IFRS. €31,533 (31 May 2025: €38,542) of wages and
salaries is charged to the statement of profit or loss, comprising staff wages
of €6,533 and 50% of the Managing Directors' salary of €25,000.
2026 2025
€ €
Wages and salaries costs as disclosed above is analysed as follows:
Wages and salaries 124,930 174,902
Social insurance costs 18,440 5,207
143,370 180,109
The amount of wages, salaries and related costs incurred during the
financial year was recorded as follows:
2026 2025
€ €
Capitalised to intangible assets 111,837 141,567
Charged to the profit or loss 31,533 38,542
143,370 180,109
The average number of persons employed during the year (including executive
Directors) by activity was as follows:
2026 2025
Corporate management and administration 2 2
Exploration and evaluation 1 1
3 3
An analysis of remuneration for each Director of the Company in the current
financial year (prior to amounts transferred to intangible assets) is as
follows:
Fees Salary Total
€ € €
Maureen T.A. Jones 10,000 50,000 60,000
Brendan McMorrow 20,000 - 20,000
Dr. Sorċa Conroy 10,000 - 10,000
Howard Bird 10,000 - 10,000
50,000 50,000 100,000
An analysis of remuneration for each Director of the Company in the prior
financial year (prior to amounts transferred to intangible assets) is as
follows:
Fees Salary Total
€ € €
Professor Richard Conroy 8,333 27,083 35,416
Maureen T.A. Jones 10,000 50,000 60,000
Brendan McMorrow 16,667 - 16,667
Séamus P. FitzPatrick 5,833 - 5,833
Dr. Sorċa Conroy 10,000 - 10,000
Howard Bird 10,000 - 10,000
60,833 77,083 137,916
No share based payments or pension contribution costs have been made or incurred
over the past number of years. It is anticipated that the Company will move
towards incorporating share based payments as part of overall remuneration in
the future. Accrued amounts of salary and pension owing to current and former
directors are set out in Note 12.
3 Loss before taxation
The loss before taxation is arrived at after charging the following items:
2026 2025
€ €
Auditor's remuneration
The analysis of the auditor's remuneration is as follows:
45,000 41,500
· Audit of entity financial statements
No fees were incurred for other assurance, tax advisory or other non-audit
services in respect of the current or prior financial years.
4 Directors' remuneration
2026 2025
€ €
Aggregate emoluments paid to or receivable 100,000 137,916
by Directors in respect of qualifying
services
Of the aggregate emoluments of €100,000 (31 May 2025: €137,916), an amount of
€25,000 was capitalised to exploration and evaluation assets, with €75,000
charged to the statement of profit or loss.
During the year ended 31 May 2026 and 31 May 2025, one Director was a member of
a defined contribution scheme but no contributions were due or paid and
accordingly none were made, no other disclosures are required by Section 305 of
the Companies Act 2014.
No compensation has been paid or is payable for the loss of office or other
termination benefit in respect of the loss of office of Director or other
offices (31 May 2025: €Nil).
5 Income tax expense
No taxation charge arose in the current or prior financial year due to losses
incurred in prior years and this year.
Factors affecting the tax charge for the financial year:
The total tax charge for the financial year is different to the standard rate of
Irish corporation tax. This is due to the following:
2026 2025
€ €
Loss on ordinary activities before taxation (529,413) (279,357)
Irish standard tax rate 12.50% 12.50%
Tax credit at the Irish standard rate (66,177) (34,920)
Effects of:
Tax effect of items not taxable or not 18,789 -
deductible
Tax effect of trading losses carried forward 47,388 34,920
for which no deferred tax asset is recognised
Tax charge for the financial year - -
No deferred tax asset has been recognised on accumulated tax losses as it cannot
be considered probable that future taxable profit will be available against
which the deferred tax asset can be utilised.
Unutilised losses may be carried forward from the date of the origination of the
losses but may only be offset against taxable profits earned from the same
trade. Unutilised losses carried forward amounted to €13,463,302 at 31 May 2026
and €13,084,193 at 31 May 2025.
6 Loss per share
Basic loss per share 31 May 31 May
2026 2025
€ €
Loss for the year attributable to equity (529,413) (279,357)
holders of the Company
Number of ordinary shares at start of the 171,769,411 105,092,749
financial year
Number of ordinary shares issued during the 24,666,666 66,676,662
financial year
Number of ordinary shares at end of the 196,436,077 171,769,411
financial year
Weighted average number of ordinary shares for 195,084,479 138,490,187
the purposes of basic and diluted loss per
share
Basic and diluted loss per ordinary share (0.0027) (0.0020)
Diluted loss per share
The effect of warrants and the conversion option attaching to the convertible
loan notes is anti-dilutive, as the Company is loss making. These instruments,
including the 19,333,333 potential ordinary shares issuable on conversion of the
convertible loan notes, are therefore excluded from the calculation of diluted
loss per share.
7 Intangible assets
Exploration
and
evaluation
assets
31 May 31 May
Cost 2026 2025
€ €
At 1 June 12,085,967 11,690,194
Expenditure
capitalised
during the
financial
year:
135,596 199,937
· Licence
and
appraisal
costs
137,191 195,836
· Other
operating
expenses
At 31 May 12,358,754 12,085,967
Exploration and evaluation assets relate to expenditure incurred in the
development of mineral exploration opportunities. These assets are carried at
historical cost and have been assessed for impairment in particular with regard
to the requirements of IFRS 6: Exploration for and Evaluation of Mineral
Resources relating to remaining licence or claim terms, likelihood of renewal,
likelihood of further expenditure, possible discontinuation of activities as a
result of specific claims and available data which may suggest that the
recoverable value of an exploration and evaluation asset is less than its
carrying amount. The Board of Directors note that the realisation of the
intangible assets is dependent on further successful development and ultimate
production of the mineral resources and the availability of sufficient finance
to bring the resources to economic maturity and profitability. Mineral
interests are categorised geographically as follows:
Finland
31 May 31 May
Cost 2026 2025
€ €
At 1 June 11,777,276 11,501,738
Expenditure capitalised
during the financial
year:
98,699 125,539
· Licence and appraisal
costs
113,261 149,999
· Other operating costs
At 31 May 11,989,236 11,777,276
Northern Ireland
31 May 31 May
Cost 2026 2025
€ €
At 1 June 308,691 188,456
Expenditure capitalised during the financial year:
36,897 74,399
· Licence and appraisal costs
23,930 45,836
· Other operating costs
At 31 May 369,518 308,691
In assessing exploration licences on a licence by licence basis within both the
Finland and Northern Ireland CGU's for impairment the Board of Directors have
considered in particular the proposed work programmes for the underlying diamond
resources in Finland and copper - nickel - platinum group elements in Northern
Ireland and their likelihood of adding to the existing resource and resource
potential in their licence areas. They have also assessed the likelihood of
securing a future strategic investment or joint venture partner to assist with
the development of the assets. The Board of Directors are satisfied that
following this review that no indications of impairment exist requiring a
reduction in the carrying value of the capitalised exploration expenditure
above.
In June 2025, shortly after the start of the year under review, the diamond
deposit at Lahtojoki had its mining permit granted by the Finnish Safety and
Chemical Agency (Tukes) and the Company is planning to enter its development
phase once funding is in place. In assessing this asset in particular, the Board
of Directors have also considered the potential recoverability of the carrying
value by evaluating a financial model for the development of the deposit at
Lahtojoki and are satisfied that no impairment of the carrying value of the
related capitalised expenditure is required.
8 Tangible assets
Tangible assets comprise plant and office equipment and computer equipment.
Plant and office equipment
31 May 31 May
Cost 2026 2025
€ €
At 1 June 3,791 1,677
Additions - 2,114
At 31 May 3,791 3,791
Accumulated depreciation
At 1 June 1,677 1,677
Charge for the financial year 529 -
At 31 May 2,206 1,677
Net book value at 31 May 1,585 2,114
No depreciation was charged in the prior financial year. The amount involved is
not material to either year.
9 Cash and cash equivalents
31 May 31 May
2026 2025
€ €
Cash held in bank accounts 47,591 40,862
47,591 40,862
Certain of the above bank accounts are held for the purpose of holding
collateral deposits related to the Finnish licenses. As at 31 May 2026, a total
amount of €24,500 (31 May 2025: €24,500) relates to these collateral deposits
and is treated as a restricted cash balance.
10 Other receivables
31 May 31 May
2026 2025
€ €
VAT receivable 33,940 76,387
Prepayments 19,767 38,707
Other receivables 2,004 2,000
55,711 117,094
The Directors consider that the carrying values of receivables are approximate
to their fair values. Expected credit losses exist in relation to the Company's
receivables as at 31 May 2026 and 31 May 2025 are negligible.
11 Warrant liabilities and convertible loan notes
Warrant liabilities
During the year ended 31 May 2026, no warrants were issued. 54,876,664 warrants
with a sterling exercise price and expiry dates of between 12 months and 24
months were issued in the prior year. The fair value amount of these warrants at
grant date was valued using the Black Scholes Model and recorded as warrant
liabilities.
At 31 May 2026, the warrants in issue were fair valued with a charge of €58,972
in respect of the movement in fair value (31 May 2025: credit of €91,738) being
recorded in the statement of profit or loss and a fair value liability of
€91,852 (31 May 2025: €32,880) recorded in the statement of financial
position.
Warrants issued on 20 February 2025 have a 24-month term and as such were
included in non-current liabilities in the prior year and current liabilities in
the current year. Warrants issued in July 2024 had a 12 month term, expired
unexercised in July 2025 and had negligible value as at 31 May 2025. See Note
16 for further details.
31 May 31 May
2026 2025
€ €
Opening balance 32,880 30,106
Warrant liability recorded on issue (Note 16) - 94,512
Movement in fair value of warrants 58,972 (91,738)
91,852 32,880
Disclosed as
Non current liability - 32,880
Current liability 91,852 -
Convertible loan notes
On 20 March 2026, the Company drew down unsecured, unlisted convertible loan
notes with a principal amount of £290,000, convertible at the holders' option at
£0.015 per share into 19,333,333 ordinary shares. Conversion is automatic if the
volume-weighted average price of the ordinary shares exceeds 3p for more than
five trading days in any ten-day period, or on a takeover of the Company.
Conversion in the first year carries a full year's interest, giving an effective
conversion price of 1.39p. Cash proceeds of €336,234 were received, being the
sterling principal translated at the rate ruling on that date, and are presented
as an inflow from financing activities in the statement of cash flows. The notes
are repayable on 20 March 2029, at which date the principal together with three
years' simple interest at 8% per annum falls due in a single settlement, giving
total contractual cash flows of £359,664 (€414,727 translated at the rate of
exchange ruling at 31 May 2026). Although no cash repayment falls due within
twelve months of the balance sheet date, the holders may convert the notes at
any time. As the conversion option is classified as a liability, conversion
would constitute settlement under IAS 1.76B and the Company does not have the
right to defer settlement for at least twelve months. The host debt and the
derivative liability are accordingly classified as current liabilities.
As the notes are denominated in sterling, which is not the Company's functional
currency, the conversion option does not meet the IAS 32 fixed-for-fixed
requirement and is accounted for as an embedded derivative liability at fair
value through profit or loss, separated from the host debt (accounting policy
1(j)). On initial recognition the conversion option was measured at its fair
value of €32,271 (£27,833) and the residual of €303,963 was allocated to the
host debt.
The derivative is remeasured to fair value at each reporting date and amounted
to €123,074 (£106,734) at 31 May 2026, giving a fair value loss of €90,803 which
is presented within finance costs in the statement of profit or loss. The host
debt component is carried at amortised cost using an effective interest rate of
11.104% and amounted to €308,648 at 31 May 2026.
Effective interest of €6,345, comprising the contractual coupon of €5,277 and
the unwind of the discount arising on separation of the derivative of €1,068,
was charged in respect of the notes during the financial year and is included
within the interest expense of €12,825 in the statement of profit or loss. A
foreign exchange gain of €1,660 arose on retranslation of the notes at the
balance sheet date and is included within operating expenses (Note 2); it does
not form part of the interest expense.
The fair value of the conversion option is a recurring Level 3 measurement,
determined using the Black-Scholes model. The inputs at 31 May 2026, based on
market data at 29 May 2026 (the last trading day before the year end), were:
share price 0.85p (drawdown: 0.375p at 19 March 2026), conversion price 1.5p,
share price volatility of 128.293% based on 12-month historical volatility
(drawdown: 103.497%), risk-free rate of 4.026% (drawdown: 4.276%) and remaining
term of 2.81 years (drawdown: 3.00 years). Volatility is the significant
unobservable input: an increase or decrease of 10 percentage points would change
the fair value of the derivative by approximately +€8,350 / −€9,104, and a 10%
rise or fall in the share price would change it by approximately +€15,386 /
−€15,143. The movement in the derivative liability during the year comprised its
recognition on drawdown of €32,271 and the fair value loss of €90,803, giving a
closing balance of €123,074 at 31 May 2026.
12 Current liabilities
Trade and other payables
31 May 31 May
2026 2025
€ €
Accrued Directors' remuneration
Fees and other emoluments 1,436,913 1,351,636
Pension contributions 263,250 263,250
Amount due to related party (see Note 15 (b)) 112,537 75,065
Directors' Current Account (Note 15) - 6,772
Other creditors and accruals 158,278 232,067
1,970,978 1,928,790
It is the Company's practice to agree terms of transactions, including payment
terms with suppliers. It is the Company's policy that payment is made according
to the agreed terms. The carrying value of the trade and other payables
approximates to their fair value.
The Directors, Maureen T.A. Jones, Dr. Sorċa Conroy, Howard Bird and Brendan
McMorrow, and former Directors, James P. Jones, Seamus P. FitzPatrick and
representatives of the Estate of Professor Richard Conroy have confirmed that
they will not seek repayment of amounts owed to them by the Company of
€1,700,163 (31 May 2025: €1,614,886) within 12 months of the date of approval of
the financial statements, unless the Company has sufficient funds to repay same.
Convertible Loan
On 26 May 2023, the Company entered into a convertible loan note agreement for a
total amount of €129,550 (£112,500) with Conroy Gold and Natural Resources
P.L.C. ("Conroy Gold") which is both a shareholder in the company and has a
number of other connections as noted in Note 15. The convertible loan note is
unsecured, had a term of 18 months and attracts interest at a rate of 5% per
annum which is payable on the maturity until the loan is repayable. The
conversion price is at a price of 5 pence per ordinary share. Conroy Gold has
the right to seek conversion of the principal amount outstanding on the
convertible loan note and all interest accrued till the settlement date.
€10,304 was recorded as a derivative liability attached to the total convertible
loan note above and the net amount of €119,246 was initially recorded as the
value of the convertible loan at 31 May 2023. The loan incurred interest of
€6,480 in the current year (31 May 2025: €6,480). The convertible term has
passed but the loan continues in place on an informal basis on the same terms
and is classified as a current liability for the year ended 31 May 2026. The
Company is in discussions with Conroy Gold to extend the term of the loan note.
31 May 31 May
2026 2025
€ €
Opening balance 132,202 125,722
Interest payable 6,480 6,480
Closing balance 138,682 132,202
13 Called up share capital and share premium
Authorised: 31 May 31 May
2026 2025
€ €
7,301,310,041 ordinary shares of €0.00025 each 1,825,328 1,825,328
317,785,034 deferred shares of €0.00999 each 3,174,672 3,174,672
5,000,000 5,000,000
The deferred shares do not entitle the holder to receive a dividend or other
distribution. Furthermore, the deferred shares do not entitle the shareholder to
receive notice of or vote at any general meeting of the Company, and do not
entitle the shareholder to any proceeds on a return of capital or winding up of
the Company.
Issued and fully paid - Current financial year
Number of Called Called up Share
ordinary up deferred share premium
shares capital
share €
capital €
€
1 June 2025 - ordinary 171,769,411 45,529 3,174,672 11,399,829
shares of €0.00025 each
Share issue (a) 24,666,666 6,167 - 211,072
Share issue costs - - - (9,584)
End of financial year 196,436,077 51,696 3,174,672 11,601,317
(a) On 20 June 2025 the Company raised €217,239 (£185,000) before share issue
costs through the issue of 24,666,666 ordinary shares of €0.00025 in the capital
of the Company at a price of £0.0075 per Subscription Share. The company
incurred share issue costs of a total of €9,584 being the broker fees in
relation to this issue.
Issued and fully paid - Prior financial year
Number of Called Called up Share
ordinary up deferred share premium
shares capital
share €
capital €
€
1 June 2024 - ordinary 105,092,749 28,860 3,174,672 10,736,889
shares of €0.00025 each
Share issue (b) 23,599,995 5,900 - 411,232
Share issue (c) 43,076,667 10,769 - 378,189
Share issue costs - - - (126,482)
End of financial year 171,769,411 45,529 3,174,672 11,399,828
(b) On 1 July 2024 the Company raised €417,132 (£354,000) before share issue
costs through the issue of 23,599,995 ordinary shares of €0.00025 in the capital
of the Company at a price of £0.015 per Subscription Share. The company
incurred share issue costs of a total of €35,901 with €20,919 being the fair
value as at date of grant of warrants issued as part of the terms attaching to
the share issue (see Note 16) and the remainder being broker costs of €14,982.
(c) On 20 February 2025 the Company raised €388,958 (£323,075) before share
issue costs through the issue of 43,076,667 ordinary shares of €0.00025 in the
capital of the Company at a price of £0.0075 per Subscription Share. The
company incurred share issue costs of €90,581 with €73,592 being the fair value
as at date of grant of warrants issued as part of the terms attaching to the
share issue (see Note 16) and the remainder being broker costs of €16,989.
Warrants: At 31 May 2026, warrants over 43,076,667 shares exercisable at £0.015
at any time up to 20 February 2027 were outstanding. No warrants were issued
during the financial year and 11,799,997 warrants exercisable at £0.03 expired
on 1 July 2025. (31 May 2025: warrants over 54,876,664 shares exercisable at
prices varying from £0.015 to £0.03 at any time up to 20 February 2027 were in
issue, all of which had been issued during that financial year).
Share price: The closing price on 29 May 2026, the last trading day before the
year end, was £0.0085 (31 May 2025: £0.00585). The share price ranged from
£0.0125 to £0.00375 (31 May 2025: £0.0274 to £0.00585) during the year under
review.
14 Commitments and contingencies
At 31 May 2026, there were no capital commitments or contingent liabilities (31
May 2025: €Nil) recognised at the balance sheet date. Should the Company decide
to further develop the Lahtojoki project, an amount of €40,000 is payable by the
Company to the vendors of the Lahtojoki mining concession.
15 Related party transactions
(a) The Company shares office accommodation with Conroy Gold and Natural
Resources P.L.C. ("Conroy Gold") which has certain common Directors and
shareholders. For the financial year ended 31 May 2026, Conroy Gold incurred
costs totalling €35,178 (31 May 2025: €83,136) on behalf of the Company, and the
Company incurred costs totalling €37,730 (31 May 2025: €20,628) on behalf of
Conroy Gold The amounts recharged are shown net of recharges in the opposite
direction, giving a net charge by the Company to Conroy Gold of €2,552 for the
financial year ended 31 May 2026 (31 May 2025: net charge by Conroy Gold to the
Company of €62,508).
These costs are analysed as follows:
2026 2025
€ €
Charged by Conroy Gold to the Company
Office salaries 24,346 52,811
Rent and rates 1,675 -
Other operating expenses 9,157 30,325
Total charged by Conroy Gold to the Company 35,178 83,136
Charged by the Company to Conroy Gold
Shared exploration facilities and (24,480) (20,628)
consultancy costs
Other operating expenses (13,250) -
Total charged by the Company to Conroy (37,730) (20,628)
Gold
Net amount charged (by the Company to (2,552) 62,508
Conroy Gold)/by Conroy Gold to the
Company
(b) At 31 May 2026, the Company owed €112,537 to Conroy Gold and Natural
Resources P.L.C. (31 May 2025: €75,065 owed to). Amounts owed to Conroy Gold and
Natural Resources P.L.C. were included within trade and other payables during
the current year. During the financial year ended 31 May 2026, the Company both
paid cash to and received cash from Conroy Gold and Natural Resources P.L.C.,
the net movement being €21,969 received from Conroy Gold and Natural Resources
P.L.C. (31 May 2025: €129,495 paid to Conroy Gold and Natural Resources P.L.C.)
as part of the cost sharing arrangement. The movement on the account arose from
€15,503 of net allocated costs, being the balance on the cost allocation account
after amounts charged in each direction are offset, and net cash movements of
€21,969. During the financial year ended 31 May 2026, the Company was charged
€35,178 (31 May 2025: €83,136) by Conroy Gold and Natural Resources P.L.C. in
respect of the allocation of certain costs as detailed in Note 15(a). On 26 May
2023, the Company entered into a convertible loan note agreement with Conroy
Gold and Natural Resources P.L.C. for a total amount of €129,550 (£112,500). The
convertible term has passed but the loan continues in place on an informal basis
on the same terms, and the carrying amount of the convertible loan, including
accrued interest, was €138,682 at 31 May 2026 (31 May 2025: €132,202), as
detailed in Note 12. Further, accrued Director's remuneration amounting to
€1,700,163 (31 May 2025: €1,614,886) is disclosed in note 12.
(c) Key management personnel are considered to be the Directors and other key
management. The compensation of all key management personnel during the year was
€115,000 (31 May 2025: €162,083) including an amount of €15,000 (31 May 2025:
€25,000) payable to the Company Secretary Cathal Jones in respect of services
provided. An amount of €37,500 was accrued and unpaid to him at 31 May 2026 and
is included within trade and other payables (Note 12). Further analysis of
remuneration for each Director of the Company is set out in Note 4.
(d) Details of share capital transactions with the Directors are disclosed in
the Directors' Report under the topic of Substantial shareholdings.
16 Share-based payments
Warrants granted by the company generally have a vesting period ranging from one
to two years. Details of the warrants outstanding during the financial year are
as follows:
2026 2026 2025 2025
No. of Share Weighted No. of Share Weighted
Warrants Average Warrants Average
Exercise Price Exercise Price
€ €
At 1 June 54,876,664 0.02217 27,900,000 0.04871
Granted during nil - 54,876,664 0.02217
the financial
year
Lapsed during the (11,799,997) 0.03459 (27,900,000) 0.04871
financial year
Exercised during - - - -
the financial
year
At 31 May 43,076,667 0.01730 54,876,664 0.02217
The warrant exercise prices are fixed in sterling at £0.03 and £0.015, giving a
weighted average exercise price of £0.018225 at 1 June 2025 and £0.015000 at 31
May 2026. The euro amounts above are translated at the closing rate at 31 May
2026 of £0.86723 to €1.
The company issued 11,799,997 sterling based warrants on 1 July 2024, with an
estimated fair value at date of grant of €20,919. The company also issued
43,076,667 sterling based warrants on 20 February 2025, with an estimated fair
value at date of grant of €73,593. Both of these issues were in conjunction
with the issue of ordinary shares as part of a financing. No warrants were
issued during the financial year ended 31 May 2026 (2025: 54,876,664 warrants
issued) and accordingly no share-based payment charge arose in the year. The
11,799,997 warrants exercisable at £0.03, which were issued on 1 July 2024 with
a one year life, expired on 1 July 2025. The remaining 43,076,667 warrants are
exercisable at £0.015 and expire on 20 February 2027. The fair value of the
warrants at the date of grant were deducted from share premium as a direct share
issue cost (see Note 13) as they are a market requirement when raising funds.
As a result of the valuation performed by the Company at year end, the fair
value of the sterling based warrants was €91,852 at 31 May 2026 (31 May 2025:
€32,880) and accordingly a charge of €58,972 (31 May 2025: credit of €91,738)
was recognised in the Statement of profit or loss as a movement in the fair
value of warrants.
The Company valued the warrants internally, in both the current and prior
financial years, using the Black Scholes Model. The determination of the fair
value of share-based payment awards on the date of grant and on revaluation at
each year end using the Black Scholes Model is affected by the Company's stock
price, share price volatility as well as assumptions regarding a number of
subjective variables. These variables include the expected term of the awards,
the stock price volatility, the risk-free interest rate and the expected
dividends.
The following key input assumptions were used to calculate the fair value of the
sterling based warrants at the balance sheet dates and, in the prior year, at
the date of issue:
31 May 2026 Date of issue 31 May 2025
Warrants Warrants Warrants
Dividend yield 0% 0% 0%
Share price volatility 128.293% 66.395% 85.106%
Risk free interest rate 3.8995% 4.183% 3.88101%
Expected life (in years) 0.726 1.0 / 2.0 0.0833 / 1.75
During the prior year, the company issued 54,876,664 sterling based warrants in
conjunction with the issue of ordinary shares as part of a financing and an
amount of €94,512, being the warrant liability recognised on issue, was deducted
from share premium as a direct issue cost. That amount formed part of total
share issue costs of €126,482 recognised in the prior year, the balance of
€31,970 representing cash costs.
17 Financial instruments
Financial risk management objectives, policies and processes
The Company has exposure to the following risks from its use of financial
instruments:
(a) Inflation;
(b) Interest rate risk;
(c) Foreign currency risk;
(d) Liquidity risk; and
(e) Credit risk.
The Board of Directors has overall responsibility for the establishment and
oversight of the Company's risk management framework.
The Company's risk management policies are established to identify and analyse
the risks faced by the Company, to set appropriate risk limits and controls, and
to monitor risks and adherence to limits.
Risk management policies and systems are reviewed regularly to reflect changes
in market conditions and the Company's activities.
The Company's Audit Committee oversees how management monitors compliance with
the Company's risk management policies and procedures and framework in relation
to the risks faced.
(a) Inflation
The Company is exposed to the risk associated with inflation such as the impact
of increased operating expenses including rent, light and heat and wages and
salaries. The Chairman and Managing Director monitor costs on an ongoing basis.
(b) Interest rate risk
The Company currently finances its operations through shareholders' funds and
loan finance. The loan finance at 31 May 2026 and 31 May 2025 relates to
convertible loans therefore any fluctuations in interest rates will not have an
impact on the results of the Company and no sensitivity analysis has been
performed. The Company did not enter into any hedging transactions with respect
to interest rate risk.
(c)Foreign currency risk
The Company is exposed to currency risk on purchases, loans and bank deposits
that are denominated in a currency other than the functional currency of the
Company. The Company is further exposed to foreign currency risk through the
warrants, the convertible loan notes and the related conversion option, all of
which are denominated in sterling, which is not the Company's functional
currency.
It is the Company's policy to ensure that foreign currency risk is managed
wherever possible by matching foreign currency income and expenditure. During
the years ended 31 May 2026 and 31 May 2025, the Company did not utilise foreign
currency forward contracts or other derivatives to manage foreign currency risk.
The Company's foreign currency risk exposure in respect of the principal foreign
currency in which the Company operates was as follows at 31 May 2026:
Sterling exposure euro exposure Total
denominated in € € €
Amount due to Conroy Gold - (112,537) (112,537)
and Natural Resources
P.L.C.
Other debtors - 21,767 21,767
Cash and cash equivalents 22,105 25,486 47,591
Derivative liability (10,304) - (10,304)
Trade and other payables - (1,858,441) (1,858,441)
VAT receivable - 33,940 33,940
Convertible loan (2023) (138,682) - (138,682)
Warrant liabilities (91,852) - (91,852)
Convertible loan (2026) (308,648) - (308,648)
Derivative liability - (123,074) - (123,074)
conversion option (2026)
Total exposure (650,455) (1,889,785) (2,540,240)
The Company's foreign currency risk exposure in respect of the principal foreign
currency in which the Company operates was as follows at 31 May 2025:
Sterling exposure euro exposure Total
denominated in € € €
Amount due to Conroy Gold - (75,065) (75,065)
and Natural Resources
P.L.C.
Other debtors - 40,707 40,707
Cash and cash equivalents (9) 40,871 40,862
Derivative liability (10,304) - (10,304)
Trade and other payables - (1,853,725) (1,853,725)
VAT receivable - 52,282 52,282
Convertible loan (2023) (132,202) - (132,202)
Warrant liabilities (32,880) - (32,880)
Total exposure (175,395) (1,794,930) (1,970,325)
The following are the significant exchange rates that applied against €1 during
the financial year:
Average Rate 2026 Average Rate 2025 Spot Rate Spot Rate
31 May 31 May
2026 2025
GBP 0.868 0.840 0.867 0.841
Sensitivity analysis
A 10% strengthening of the euro against Sterling, based on outstanding financial
assets and liabilities at 31 May 2026 would have decreased the reported loss by
€65,046 (31 May 2025: €17,539) as a consequence of the retranslation of foreign
currency denominated financial assets and liabilities at those dates. A
weakening of 10% of the euro against Sterling would have had an equal and
opposite effect.It is assumed that all other variables, especially interest
rates, remain constant in the analysis.
(d)Liquidity risk
Liquidity risk is the risk that the Company will not be able to meet its
financial obligations as they fall due. The Company's approach to managing
liquidity is to ensure, as far as possible, that it will always have sufficient
liquidity to meet its liabilities when due, under both normal and adverse
conditions, without incurring unacceptable losses or risking damage to the
Company's reputation. The Company manages liquidity risk by regularly monitoring
cash flow projections. The nature of the Company's exploration and appraisal
activities can result in significant differences between expected and actual
cash flows. The Company had cash and cash equivalents of €47,591 at 31 May 2026
(31 May 2025: €40,862) further the €24,500 is restricted and hence unable to
meet the below liabilities and general funding of the activities as stated in
Note 9. Contractual maturities of financial liabilities as at 31 May 2026 were
as follows:
Carrying Contractual 6 months 6-12 1-2 years 2-5
amount € cash flows € or less € months years
€ €
€
Trade and 1,970,978 1,970,978 270,815 * - 1,700,163 -
other **
payables
Convertible 138,682 148,986 148,986 - - -
loan (2023)
***
Warrant 91,852 91,852 - 91,852 - -
liabilities
Convertible 308,648 414,727 - - - 414,727
loan
(2026)****
2,510,160 2,626,543 419,801 91,852 1,700,163 414,727
Contractual maturities of financial liabilities as at 31 May 2025 were as
follows:
Carrying Contractual 6 months 6-12 1-2 years 2-5
amount € cash flows € or less € months years
€ €
€
Trade and 1,928,790 1,928,790 307,130 * - 1,621,660 -
other **
payables
Convertible 132,202 142,506 142,506 - - -
loan (2023)
***
2,060,992 2,071,296 449,636 - 1,621,660 -
* The amount of €270,815 (31 May 2025: €307,130) relates to other payables
including amounts owed to Conroy Gold and Natural Resources P.L.C.).
** The Directors, Maureen T.A. Jones, Dr. Sorċa Conroy, Howard Bird and Brendan
McMorrow, and former Directors, James P. Jones, Seamus P. FitzPatrick and the
Estate of Professor Richard Conroy, have confirmed that they will not seek
repayment of amounts owed to them by the Company of €1,700,163 (31 May 2025:
€1,614,886) within 12 months of the date of approval of the financial
statements, unless the Company has sufficient funds to repay. There were no
related party loans in existence at 31 May 2026 relating to monies owed to any
of the Directors.
*** On 26 May 2023, the Company has entered into a convertible loan note
agreement for a total amount of €129,550 (£112,500) with one of its
shareholders. See Note 12 for further details. The contractual cash amount
owing at 31 May 2026 of €148,986 (31 May 2025: €142,506) is reflected in the
balance sheet of the Company split between a loan and an embedded derivative
liability of €10,304 leaving the carrying value at 31 May 2026 at €138,682 (31
May 2025: €132,202).
**** On 20 March 2026, the Company has entered into a three year convertible
loan note agreement with a number of investors for a total amount of €336,234
(£290,000). See Note 11 for further details. The full contractual amount that
will be owing at 20 March 2029 will be €414,727 (£359,664), being the principal
together with three years' simple interest at 8% per annum, translated at the
closing rate. The conversion option of €123,074 is settled in shares, gives rise
to no cash outflow and is therefore excluded from the table above.
(e) Credit risk
Credit risk is the risk that one party to a financial instrument will cause a
financial loss for the other party by failing to discharge its obligation.
Credit risk is the risk of financial loss to the Company if a cash deposit is
not recovered. Company deposits are placed only with banks with appropriate
credit ratings. The carrying amount of financial assets represents the maximum
credit exposure. Other receivables above comprise prepayments of €19,767 (31 May
2025: €33,152), an insurance prepayment of €nil (31 May 2025: €5,555) and a
permit deposit of €2,000 (31 May 2025: €2,000).
The Company's cash and cash equivalents are held with two banking
counterparties. At 31 May 2026, €23,032 was held with Allied Irish Banks, p.l.c.
(Moody's Aa3, S&P A+) and €24,559 with Nordea Bank Abp (Moody's Aa2, S&P AA-,
Fitch AA) (31 May 2025: €16,380 and €24,482). The Nordea balances include the
€24,500 of collateral deposits referred to in Note 9.
Expected credit loss
The Company measures credit risk and expected credit losses on financial assets
measured at amortised cost using probability of default, exposure at default and
loss given default. Management consider both historical analysis and forward
-looking information in determining any expected credit loss. At 31 May 2026 and
31 May 2025, €23,091 of cash was accessible on demand and €24,500 was held as
pledged collateral (31 May 2025: €16,362 and €24,500), and all cash was held
with counterparties with a credit rating of BBB or higher. Having considered the
credit rating of the counterparties and the outstanding balances, management
have determined that for both financial years presented, the amount of ECL is
immaterial.
(f) Fair values versus carrying amounts
Due to the short-term nature of the majority of the Company's financial assets
and liabilities held at amortised cost at 31 May 2026 and 31 May 2025, the fair
value is a reasonable approximation of the carrying amount in each case. The
conversion option attaching to the 2026 convertible loan notes is carried at
fair value, a Level 3 measurement (see Note 11).
(g) Capital management
The principal activities of the Company are concentrating particularly on
diamond exploration and evaluation. The Company has historically funded its
activities through share issues and placings and loans. The Company's capital
structure is kept under review by the Board of Directors and it is committed to
capital discipline and continues to maintain flexibility for future growth. The
capital structure of the Company consists of equity of the Company (refer to the
statement of changes in equity and Note 13). The Company is not subject to any
externally imposed capital requirements.
18 Post balance sheet events
The following are non-adjusting events after the reporting period.
Since 31 May 2026 the Company has continued to pursue a number of financing and
funding options which, if successfully concluded, would provide the Company with
capital to advance the work programmes on its projects in Finland and Northern
Ireland and to meet general working capital requirements. No such financing had
been concluded at the date of approval of these financial statements. The
Directors' assessment of going concern, set out in Note 1, reflects this
position.
The Board has continued to progress a plan to restructure the amounts owed to
current and former directors in respect of salaries and directors' fees,
amounting to €1,700,163 at 31 May 2026 (Note 12), with the objective of aligning
settlement of those amounts with the future success of the Company. Those
amounts continue to be deferred, the current and former directors concerned
having renewed annually their commitment not to seek payment unless the Company
is in a position to discharge them. No agreement had been reached, and no
amounts had been settled or converted, at the date of approval of these
financial statements.
Discussions with Conroy Gold and Natural Resources plc regarding a formal
extension of the term of the convertible loan note of £112,500 (Note 12), and an
amendment to its conversion price, remained ongoing at the date of approval of
these financial statements. Any variation remains subject, inter alia, to
finalisation of a variation agreement and to any approvals required under the
AIM Rules for Companies.
There were no other material events subsequent to the reporting date which
necessitate revision of the figures or disclosures included in these financial
statements.
19 Approval of the financial statements
The financial statements were approved by the Board of Directors on 4 November
2026 and authorised for issue on 4 November 2026. A copy of the audited
financial statements will be available on the Company's website
www.kareliandiamondresources.com and will be available from the Company's
registered office at Shannon Airport House, Shannon Free Zone, Shannon, Co.
Clare, V14E370 Ireland.
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Karelian Diamond Resources Plc - Final Results for the Year Ended 31 May 2026
Summary by 6ix AI
Karelian Diamond Resources plc, a diamond exploration company focused on Finland with nickel, copper and platinum interests in Northern Ireland, reported a loss of €529,413 for the year ended May 31, 2026, compared with a loss of €279,357 a year earlier. Its auditor flagged a material uncertainty about its ability to continue as a going concern (keep operating).
Key details
- The auditor cited net current liabilities of €2,540,236 at May 31, 2026 and a requirement to raise funds to carry out the company's plans. Cash was €47,591 at that date.
- In June 2025 the Finnish Safety and Chemical Agency (Tukes) registered the mining rights for Lahtojoki and issued the mining concession certificate. Talks to secure finance to take Lahtojoki through development to production remain ongoing.
- At the Anomaly 5 target in the Kuhmo region, a three-hole drilling programme totalling approximately 334 metres was completed. Two holes hit rock provisionally interpreted as olivine lamproite, a rock type associated with diamond-bearing areas, including an eight metre interval in hole KD-26-02.
- In June 2025 the company raised €217,239 (£185,000) before costs by issuing 24,666,666 new shares at 0.75 pence each. In March 2026 it raised €336,234 (£290,000) through three-year unsecured convertible loan notes, which can be exchanged for shares at 1.5 pence per share, paying 8 per cent a year.
- Current and former directors confirmed they will not seek repayment of €1,700,163 owed to them for at least 12 months from approval of the financial statements, unless the company has sufficient funds to repay.
What’s still pending
- No new financing had been concluded when the financial statements were approved on November 4, 2026; the company continues to pursue financing options.
- Anomaly 5 drill core samples are being prepared for analysis to formally classify the rock and assess its diamond-bearing potential; a limited ground electromagnetic survey is planned to guide further drilling.
- Talks with Conroy Gold and Natural Resources plc on extending the £112,500 convertible loan note and amending its conversion price remain ongoing; any change remains subject, among other things, to a final variation agreement and any approvals under the AIM Rules for Companies (its market's rules).
- No agreement has been reached on the plan to restructure the €1,700,163 owed to current and former directors.
6ix AI wrote this summary from the release below and checked it against the release.
Karelian Diamond Resources PLC on 6ix
Earlier from Karelian Diamond Resources
- Karelian Diamond Resources Plc - Notice of Annual General Meeting and Update on Publication of Annual Report
- Notice of Annual General Meeting and Update o...
- Holding(s) in Company
- Update on drilling programme at Kuhmo
- Fundraising of £290,000 & operational and cor...
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