(Alliance News) - Eurasia Mining PLC reported on Monday that its annual loss had widened and its assets and sales were down following the Russian invasion of Ukraine and supply chain interruptions hammering business.
Eurasia Mining, the London-headquartered, Russia-focused mining and mineral exploration company, reported a widened pretax loss of GBP7.2 million in 2022 from GBP3.1 million in 2021.
The company said this loss was principally caused by its decision to stockpile the ore from West Kytlim, a mine located in the Russian Ural mountains, and not to generate revenue from Russia in 2022 due to its strong cash position.
"Apart from the Ukraine conflict which hit the world hard in February, the entire industry has been disrupted by supply chain interruptions although this has, however, resulted in positive price changes for Eurasia Mining's metals," said Managing Director and Chair Christian Schaffalitzsky.
Sales were down to GBP119,525 from GBP2.3 million, whilst administrative costs widened to GBP4.6 million from GBP2.7 million year-on-year.
Total assets were down to GBP25.3 million from GBP31.2 million the year prior.
Eurasia Mining said that it had "satisfied itself" that its current activities at the West Kytlim mine and on the Kola Peninsula, in the extreme north-west Russia, were not prohibited under UK or EU sanction rules, and it therefore had to sell the West Kyltim mine product.
The company also announced that it had simultaneously received approval for its definitive feasibility study for its Monchetundra project in the Kola peninsula of north western Russia, but also that the company had made management changes to reflect the sale of its Russian assets, including this Mochentundra project.
Eurasia Mining explained: "The board does not believe it is appropriate to commence construction immediately due to the ongoing sales process of its Russian assets".
The commencement of a definitive feasibility study will make the sales process more likely, with the company stating that it expects counterparties to have their own plans for future development and it would leave these options open.
However, the company also said that there could be no guarantee that Eurasia would enter into binding agreements regarding the sales process.
Meanwhile, Eurasia Mining also announced that Chief Executive Officer James Nieuwenhuys was retiring with immediate effect.
"James has worked hard at taking this project to this milestone after similar work at West Kytlim and the board wishes him well in his future activities," said Eurasia Mining.
"In terms of the future development of Eurasia Mining PLC, we continue to look at expanding the business in various ways, including the development of hydrogen projects outside Russia coupled with new mining opportunities in investment friendly jurisdictions.
"Our strategy continues to be the eventual sale of the company's assets in Russia, being the West Kytlim operating mine, the Monchetundra Project mining license, the NKT brownfield project, and the entitlement to the Nyud brownfield project."
Shares in Eurasia Mining were up 14% at 3.00 pence in London on Monday.
By Will Neill, Alliance News reporter
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Eurasia Mining (EUA)