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(Alliance News) - SolGold PLC on Friday said it swung to a considerable loss in its latest financial year, mainly thanks to surging administrative expenses, and it said it will need additional funding to continue operations.
The London-based copper and gold explorer in Ecuador reported a USD49.3 million pretax loss for the year that ended June 30, compared with a USD2.8 million profit the year before.
SolGold has not yet generated any revenue, and its operating loss widened to USD38.5 million from USD21.4 million. This was primarily driven by administrative expenses, which more than doubled to USD41.2 million from USD17.6 million.
The pretax profit in financial 2022 was thanks to a USD35.0 million gain from the remeasurement of the amortised cost of a financial liability.
SolGold noted its acquisition of and merger with Cornerstone Capital Resources Inc, completed in late February, which Chair Liam Twigger called "a momentous milestone". Consideration was paid entirely in SolGold shares, and the deal gave SolGold 100% ownership of its flagship Cascabel copper-gold project in the northern Imbabura province.
SolGold said its cash and equivalents balance was USD32.5 million at June 30, up from USD26.1 million on the same day in 2022.
Going forward, SolGold said its lack of revenue from operations and cashflow forecasts show that it must secure additional funding to continue its exploration and development programme. It said management is currently exploring options for obtaining such funding, but it has not yet received any firm commitments.
However, it also said its current cash balance should support its operations through to the end of the current financial year without needing immediate external financing.
"Today we find ourselves at a significant juncture," Twigger remarked. "As the global momentum shifts towards a greener, carbon-neutral economy, the demand for copper escalates. SolGold, equipped with assets like Cascabel, and our highly prospective exploration portfolio, is uniquely positioned to play a central role in this transformation."
Shares in SolGold were down 0.5% at 12.95 pence in London on Friday.
By Emma Curzon, Alliance News reporter
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