From pdf16 May 2024 07:16
Going concern
As at 31 March 2024, SolGold Plc (the “Company”) and its subsidiaries (the “Group”) had cash on hand of $3,452,963 and net
current assets of $3,540,879. Following the successful completion of a $10 million financing subsequent to the balance sheet
date, the group has sufficient liquidity for the next few months but less than twelve months to support its operations while
it explores substantial and longer-term funding solutions. On 13 May 2024, the Company agreed to a short-term $10
million loan. The loan may be repaid early and other terms and conditions are customary for the nature of the loan.
The Directors have reviewed the cash position and cash position forecast of the Group and the Company for the period to 30
September 2025 and consider it appropriate that the Group and the Company financial statements are prepared on the going
concern basis. This basis contemplates the continuity of normal business activities and the realisation of assets and discharge
of liabilities in the ordinary course of business, for the reasons set out below.
The Group has not generated revenues from operations in its history. Like many exploration and development companies, the
Group raises finance for its exploration and appraisal activities in discrete tranches. Therefore, the ability of the Group to
continue as a going concern depends on its ability to manage costs and secure additional financing within the next twelve
months. Management’s cash flow forecasts show that the Group and the Company need to secure additional funding to
continue their exploration and development programme and in order to continue to meet their obligations and liabilities as
they fall due.
A going concern assessment conducted by the Group, reviewing its current and projected financial performance and position,
including current assets and liabilities, future commitments, and forecast cash flows, has determined in management’s base
case and downside scenarios, there is not sufficient liquidity for at least the next twelve months from the date of approval of
these financial statements, without the receipt of additional financing.
The Company has a proven ability to execute equity and other financings, most recently demonstrated by the completion of a
$10 million borrowing subsequent to 31 March 2024. The Directors have a reasonable expectation that the Group will be able
to raise further funds when necessary and, as has been the case previously, the Directors expect that future funding will likely
be provided by equity investors, debt, or via other strategic arrangements.
If the Company is unable to secure sufficient funding, it may not be able to fully develop its portfolio of exploration projects,
and this may have a consequential impact on the carrying value of the related exploration assets and the investment of the
parent company in its subsidiaries as well as the going concern status of the Group and the C
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