Alba Mineral Resources Regulatory News (ALBA)

Significant non-cash transactions in the period not reflected above are:

- Revaluation of the Group's and Company's investment in Horse Hill Developments Limited, impairing the investment value by £615,000 (2020: £1,430,000). The impairment of investment is not included in operating costs so is not reflected in the cash flow statement above. See Note 11.

- Group reorganisation and dilution of ownership as detailed in Note 5, leading to creation of an NCI of £2,806,000 and a Dilution of ownership reserve of £991,000.

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 NOVEMBER 2021

1. ACCOUNTING POLICIES AND BASIS OF PREPARATION

Alba Mineral Resources plc is a public limited company incorporated and domiciled in England & Wales, whose shares are publicly traded on the AIM market of the London Stock Exchange plc. The registered office address is 6th Floor 60 Gracechurch Street, London, United Kingdom, EC3V 0HR. The principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been applied consistently to all the years presented.

a. Basis of preparation

These consolidated financial statements of Alba Mineral Resources plc have been prepared in accordance with International Financial Reporting Standards in conformity with the requirements of the Companies Act 2006 ("IFRSs") as they apply to the Group for the year ended 30 November 2021 and with the Companies Act 2006. Numbers have been rounded to £'000.

The consolidated financial statements have been prepared on the historical cost basis, save for the revaluation of certain financial assets and liabilities at fair value.

The preparation of financial statements requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the group's accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the consolidated financial statements, are disclosed in Note 2.

New and amended Standards and interpretations effective at 1 December 2020

During the year, the Group adopted the following new and amended IFRSs for the first time for the reporting period commencing 1 December 2020:

· Amendments to IAS 1 and IAS 8 - Definition of material

· Amendments to IFRS 3 - Definition of a business

· Amendments to the Conceptual framework for Financial Reporting

There is no material impact on the financial statements following the adoption of these new standards and interpretations.

New standards, amendments, and interpretations not yet effective

Certain new accounting standards and interpretations have been published that are not mandatory for 30 November 2021 reporting periods and have not been early adopted by the Group. These standards include:

· Interest Rate Benchmark Reform - IBOR 'phase 2' (Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16) that addresses issues that might affect financial reporting after the reform of an interest rate benchmark including its replacement with an alternative benchmark rate. These amendments are mandatorily effective for periods beginning 1 January 2021.

· IAS 37 - Onerous Contracts - Cost of Fulfilling a Contract amending the standard regarding costs a company should include as the cost of fulfilling a contract when assessing whether a contract is onerous. These amendments are mandatorily effective for periods beginning 1 January 2022.

· IAS 16 - Property, Plant and Equipment - Proceeds before Intended Use regarding proceeds from selling items produced while bringing as asset into the location and condition necessary for it to be capable of operating in the manner intended by management. These amendments are mandatorily effective for periods beginning 1 January 2022.

· IAS 1 - Presentation of Financial statements - The classification of liabilities as current or non-current basing the classification on contractual arrangements at the reporting date. These amendments are effective for periods beginning 1 January 2023.

The Directors do not anticipate that the adoption of these amendments will have a material impact on the financial statements of the Company and the Group in the period of initial application or in future reporting periods. Other amendments, standards and interpretations are in issue, both endorsed and not yet endorsed, but they are not relevant to the Group and as such they are not commented on.

b. Going concern

Based on financial projections prepared by the Directors, the Group's current cash resources are insufficient to enable the Group to meet its recurring outgoings and projected exploration expenditure for the entirety of the next twelve months. The Directors have prepared 12-month cash flow forecasts to 31 May 2023 which take into account planned exploration spend, costs and external funding. The need for external funding is a material uncertainty that may cast doubt on the Group's ability to continue as a going concern. At this stage as an explorer the Group does not have a steady income stream and is reliant on external funding sources such as capital raisings or asset transactions to fund activities. The nature of these is ad-hoc and as such the Group does not carry a cash balance sufficient for 12 months of expenditure. However, the Board has a reasonable expectation that the Group will continue to be able to meet its commitments for the foreseeable future by raising funds when required from the equity capital markets and based on the following:

· The Group has a strong track record in sourcing external funding.

· Forecasts contain a level of discretionary spend such that in the event that cash flow becomes constrained action can be taken to enable the Group to operate within available funding. The Group demonstrated this during the Covid-19 pandemic when sourcing capital was uncertain.

· The Group and Company may also consider future joint venture funding arrangements in order to share the costs of the development of its exploration assets, or to consider divesting of certain of its assets and realising cash proceeds in that way in order to support the balance of its exploration and investment portfolio. 

For these reasons the Directors continue to adopt the going concern basis of accounting in preparing the financial statements.

c. Basis of consolidation

The consolidated financial statements incorporate the financial statements of the Company and companies controlled by the Company, the Subsidiary Companies, drawn up to 30 November each year.

Control is recognised where the Company has the power to govern the financial and operating policies of an investee entity so as to obtain benefits from its activities. Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are deconsolidated from the date that control ceases. The results of subsidiaries acquired or disposed of during the year are included in the consolidated income statement from the effective date of acquisition or up to the effective date of disposal, where appropriate. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by the Group. All intra-group transactions, balances, income and expenses are eliminated on consolidation.

Non-controlling interests in the net assets of consolidated subsidiaries are identified separately from the Group's equity therein.

Changes in ownership interests in subsidiaries without change of control

Transactions with non-controlling interests that do not result in loss of control are accounted for as equity transactions - that is, as transactions with the owners in their capacity as owners. The difference between fair value of any consideration paid and the relevant share acquired of the carrying value of net assets of the subsidiary is recorded in equity. Gains or losses on disposals to non-controlling interests are also recorded in equity within the dilution of ownership reserve.

Non-controlling interests consist of the amounts of those interests at the date of the original business combination and the minority's share of changes in equity since the date of the combination.

d. Foreign currency

For the purposes of the consolidated financial statements, the results and financial position of each Group entity are expressed in pounds sterling, which is the presentation currency for the consolidated financial statements.

In preparing the financial statements of the individual entities, transactions in currencies other than the entity's functional currency (foreign currencies) are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting date, monetary items denominated in foreign currencies are retranslated at the rates prevailing at the reporting date. Exchange differences arising are included in profit or loss for the period.

For the purposes of preparing consolidated financial statements, the assets and liabilities of the Group's foreign operations are translated at exchange rates prevailing on the reporting date. Income and expense items are translated at the average exchange rates for the period. Gains and losses from exchange differences so arising are shown through the Consolidated Statement of Changes in Equity.

e. Share based payments

Share-based compensation benefits are made on an ad-hoc basis on the recommendations of the Remuneration Committee or via the Enterprise Management Incentive Scheme where the employee meets the qualifying conditions. The fair value of warrants or options granted is recognised as an employee benefits expense, with a corresponding increase in the warrant reserve. The total amount to be expensed is determined by reference to the fair value of the options granted:

o  including any market performance conditions (eg the entity's share price)

o  excluding the impact of any service and non-market performance vesting conditions (eg profitability, sales growth targets and remaining an employee of the entity over a specified time period), and

o  including the impact of any non-vesting conditions (eg the requirement for employees to save or hold shares for a specific period of time).

The total expense is recognised over the vesting period, which is the period over which all of the specified vesting conditions are to be satisfied. At the end of each period, the entity revises its estimates of the number of options that are expected to vest based on the non-market vesting and service conditions. It recognises the impact of the revision to original estimates, if any, in profit or loss, with a corresponding adjustment to the warrant reserve.

f. Non-current assets

Intangible assets: Deferred exploration and evaluation costs

Pre-licence costs are expensed in the period in which they are incurred. Expenditure on licence renewals and new licence applications covering an area previously under licence are capitalised in accordance with the policy set out below.

Once the legal right to explore has been acquired, exploration costs and evaluation costs arising are capitalised on a project-by-project basis, pending determination of the technical feasibility and commercial viability of the project. Costs include appropriate technical and administrative expenses. If a project is successful, the related expenditures will be reclassified as development and production assets and amortised over the estimated life of the commercial reserves. Prior to this, no amortisation is recognised in respect of such costs. When all licences comprising a project are relinquished, a project abandoned, or is considered to be of no further commercial value to the Company, the related costs will be written off to administrative expense within profit or loss. Deferred exploration costs are carried at historical cost less any impairment losses recognised.

Where the Group has entered into a farm out agreement, the Group does not record any expenditure made by the farmee on its account. It also does not recognise any gain or loss on its exploration and evaluation farm-out arrangements but redesignates any costs previously capitalised in relation to the whole interest as relating to the partial interest retained. Any cash consideration received directly from the farmee is credited against costs previously capitalised in relation to the whole interest with any excess accounted for as a gain on disposal.

Where the Group enters into a farm in agreement, the Group recognises all expenditure which it incurs under that agreement, with the expenditure being either capitalised or expensed in accordance with the policy detailed above.

Intangible assets: Development and production assets

Development and production assets are accumulated into cost centres and represent the cost of developing the commercial reserves and bringing them into production together with any previously deferred exploration and evaluation.

On acquisition of development and production assets from a third party, the asset will be recognised in the financial statements on signature of the sale and purchase agreement, subject to satisfaction of any substantive conditions within the agreement.

Costs relating to each cost centre are depreciated on a unit of production method based on the commercial proven reserves for that cost centre. Changes in reserve quantities and cost estimates are recognised prospectively. On disposal of any part

of a development and production asset, proceeds are credited to the Statement of Comprehensive Income, less the percentage cost relating to the disposal.

A review is performed for any indication that the value of the development and production assets may be impaired. Where there are such indications, an impairment test is carried out on the relevant cost centre. Additional depletion is included within cost of sales within the Statement of Comprehensive Income if the capitalised costs of the cost centre exceed the associated estimated future discounted cash flows of the related commercial oil and gas reserves.

Property, plant and equipment

Land is shown at cost and is not depreciated as it is not a wasting asset. The land owned by the Group is an integral part of access to one of the Group's projects and as such its value is reviewed annually as part of the impairment review of that project value as a whole.

Plant and equipment is stated at historical cost less accumulated depreciation and impairment. Historical cost includes expenditure that is directly attributable to the acquisition of the items.

Depreciation is calculated on a straight-line basis to write off the net cost of each item of property, plant and equipment (excluding land) over their expected useful lives as follows:

o  Plant and equipment 10 years

The residual values, useful lives and depreciation methods are reviewed, and adjusted if appropriate, at each reporting date. An item of property, plant and equipment is derecognised upon disposal or when there is no future economic benefit to the consolidated entity. Gains and losses between the carrying amount and the disposal proceeds are taken to profit or loss. Any revaluation surplus reserve relating to the item disposed of is transferred directly to retained profits.

Investment in subsidiaries: Investment in subsidiaries, comprising equity instruments and capital contributions, are recognised initially at cost less any provision for impairment.

g. Financial instruments

Financial assets and financial liabilities are recognised in the statement of financial position when the Group becomes a party to the contractual provisions of the instrument. The classification is dependent on the business model adopted for managing the financial assets and the contractual terms of the cash flows expected to be derived from the assets.

The Group classifies its financial instruments as follows:

Trade and other receivables: Trade and other receivables are held for the collection of contractual cash flows and are classified as being measured at amortised cost. They are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method less provision for impairment.

Loans to subsidiaries: Long-term loans to subsidiaries, other than capital contributions, are held for the collection of contractual cash flows and are classified as being measured at amortised cost, net of provision for impairment. Impairment is initially based on the expected lifetime credit loss as applied to the portfolio of loans. The loans are interest free and have no fixed repayment terms. As such the loans are assessed as being credit impaired on inception and lifetime expected credit losses are recognised with the amount of provision being recognised in the profit or loss.

A loan will be subject to impairment review if there is an indicator of impairment, such as the impairment of the value of the deferred exploration intangible asset within the relevant subsidiary. A loan is fully impaired when the relevant subsidiary recognises an impairment of its deferred exploration expenditure, such that the subsidiary is not expected to be able to repay the loan from its existing assets.

Investments: Investments in unlisted equity instruments whose fair value cannot be reliably measured are recognised initially at investment cost. Any shareholder loans made are included in the investment cost. Where a value can be reliably measured the investment is subsequently recognised at fair value through profit and loss. Information about the methods and assumptions used in determining fair value is provided in Note 11.

Trade and other payables: Trade and other payables are not interest bearing and are recognised initially at fair value and subsequently measured at amortised cost.

Derivative financial instrument

A derivative financial instrument is recognised for the 10% call option over the remaining shares in the Clogau gold project not owned by the Group. This has been valued based on management's best estimate and classified as fair value through profit and loss so that any future change in the valuation of the liability will be recognised through the profit and loss account. See Note 16 to the Accounts.

A 4% net smelter return royalty was also agreed as part of the consideration. The Company has a buy-back right in respect of any proposed sale of the royalty. No value has been attributed to this right in these accounts as it cannot be quantified due to uncertainty in reaching commercial production and what the resulting royalty quantum would be likely to be

Borrowings: Initially recognised at fair value net of any transaction costs directly attributable to the issue of the instrument. Such interest-bearing liabilities are then subsequently measured at amortised cost using the effective interest rate method. Interest expense includes initial transaction costs and any premium payable on redemption, as well as any interest or coupon payable while the liability is outstanding.

Liability components of convertible loan notes are measured as described further below.

Other borrowings: recognised initially at fair value and subsequently measured at amortised cost.

Convertible debt: The proceeds received on issue of the Group's convertible debt are allocated into their liability and equity components. The amount initially attributed to the liability component equals the discounted cash flows using a market rate of interest that would be payable on a similar instrument that does not include an option to convert. Subsequently, the liability component is measured at amortised cost until extinguished on conversion or maturity of the bond. The balance of the proceeds is allocated to the conversion option and is recognised within shareholders' equity. (The Company issued a convertible loan note during the prior period that that was fully converted prior inside that reporting period).

Leases: The Group does not have any leases within the scope of IFRS16.

h. Equity

Share capital represents the nominal value of equity shares, both ordinary and preference.

Share premium representing the excess over nominal value of the fair value of consideration received for equity shares, net of expenses of the share issue.

Dilution of ownership reserve represents the difference between the fair value of any consideration paid and the relevant share of the fair value of net assets acquired in a dilutive transaction where control is retained.

The nature and purpose of other reserves is shown in Note 19.

i. Taxation

The charge for taxation is based on the profit or loss for the year and takes into account deferred tax. The tax expense for the period comprises current and deferred tax. Tax is recognised in the income statement, except to the extent that it relates to items recognised directly in equity. In this case the tax is also recognised directly in other comprehensive income or directly in equity, respectively.

The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the end of the reporting period in the countries where the Company operates and generates taxable income. Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax regulation is subject to interpretation. It establishes provisions where appropriate on the basis of amounts expected to be paid to the tax authorities.

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 or loss, and is accounted for using the liability method.

Deferred tax assets are only recognised to the extent that it is probable that future taxable profit will be available in the foreseeable future against which the temporary differences can be utilised.

Deferred income tax is recognised, using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements. However, the deferred tax is not accounted for if it arises from initial recognition of an asset or liability in a transaction other than a business combination that, at the time of the transaction, affects neither accounting nor taxable profit or loss. Deferred income tax is determined using tax rates (and laws) that have been enacted, or substantially enacted, by the end of the reporting period and are expected to apply when the related deferred income tax asset is realised, or the deferred income tax liability is settled.

Deferred income tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets against current tax liabilities, and when the deferred income tax assets and liabilities relate to income taxes levied by the same taxation authority on either the taxable entity or different taxable entities where there is an intention to settle the balances on a net basis.

j. Segmental information

An operating segment is a distinguishable component of the Group which is subject to risks and rewards that are different from those of other segments. In the Group's current portfolio, the geographical location of exploration projects provides the basis for grouping into segments.

Operating segments are reported in a manner consistent with internal reporting provided to the chief operating decision-maker. The chief operating decision-maker, who is responsible for allocating resources and assessing performance of the operating segments, has been identified as the Board of Directors of the Company.

2 CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS

The preparation of the financial statements in conformity with generally accepted accounting practice requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities as well as the disclosure of contingent assets and liabilities at the reporting date and the reported amounts of revenues and expenses during the reporting period. Actual outcomes could differ from those estimates.

Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. The areas of judgement that have the most significant effect on the amounts recognised in the financial statements are as follows:

i) JUDGEMENTS

Capitalisation of exploration and evaluation costs - £2,584,000

The capitalisation of exploration costs relating to the exploration and evaluation phase requires management to make judgements as to the future events and circumstances of a project, especially in relation to whether an economically viable extraction operation can be established. In making such judgements, the Directors take comfort from the findings from exploration activities undertaken, the fact the Group intends to continue these activities and that the Company expects to be able to raise additional funding to enable it to continue the exploration activities.

Impairment assessment of exploration and evaluation costs - £6,110,000

At each reporting date, management make a judgment as to whether circumstances have changed following the initial capitalisation and whether there are indicators of impairment. If there are such indicators, an impairment review will be performed which could result in the relevant capitalised amount being written off to the income statement.

Accounting for investment in Horse Hill Developments Limited - £3,385,000

The Group and Company's investment in Horse Hill Developments Limited ("HHDL") is in the form of equity and a shareholder loan. However, the Directors judge that the loan is in substance part of the equity investment as governed by the HHDL investment agreement. As such the loan element of the investment is accounted for at fair value with movements in fair value being taken to profit or loss (FVTPL).

The Group and Company's shareholding in HHDL is less than 20%. A director of the Company is also a director of HHDL but does not act in an executive capacity. At the balance sheet date HHDL had a majority shareholder with a 77.9% shareholding. The Directors judge that the Company does not have significant influence over HHDL and that it should not be equity accounted for as an associate.

Company only - Impairment assessment of investment in and loans to subsidiaries - £7,811,000

Impairment charges for the year - release of provision £454,000 

In preparing the parent company financial statements, the Directors apply judgement to decide if any, or all of the company's investments in (and where applicable loans to) each of GreenRoc Mining plc, Aurum Mineral Resources Limited, Dragonfire Mining Limited group and GMOW Gwynfynydd Limited are impaired or not.

These companies have no source of funds other than their shareholders and the ability of the companies to repay their inter-company debt and for the Company to gain value from its investments in the companies is dependent on the future success of the companies' exploration activities. In undertaking their review, the Directors consider the outcome of their impairment assessment of the relevant licences as detailed above.

The Directors have used the Expected Credit Loss model to make a general provision against intercompany loans receivable based on historic credit losses and current data. In applying the expected credit loss model, the directors have judged that the loans to the subsidiaries were credit impaired on inception. See Note 12 for further details.

ii) ESTIMATES

Carrying value of investment in Horse Hill Developments Limited - £3,385,000

The Company's investment in Horse Hill Developments Limited is carried at fair value, as, in the judgement of the Directors, it has been possible to estimate a reliable fair value for the investment. For further details of the valuation see Note 11.

Valuation of put and call option over 10% of Gold Mines of Wales - £214,000

The Group has a put and call option over the 10% minority shareholding in Gold Mines of Wales. That option becomes live on the granting of planning permission for production or at an earlier date by agreement. The option expires on 24 August 2028 and was valued at £34,000 on the date of acquisition in 2018. Management has categorised this contingent consideration as a derivative financial instrument at fair value through profit or loss and has estimated the value of the 10% as based on 10% of the accumulated exploration spend on the project to date, being the approximate basis that management would use to value the option should they seek to exercise it.

3. ANALYSIS OF SEGMENTAL INFORMATION

The Group currently only has one primary reporting business segment, exploration and development. The Board of the Company evaluates the business on a sector basis, the two sectors being mining and oil and gas. The group exploration assets and investments along with capital expenditures are presented on this basis below:

The Group's primary business activities operate in three different geographical areas (and the Group has an investment in a fourth area) and the group exploration assets and investments along with capital expenditures are presented on the basis of geographical segments below:

The administrative expenditure in the income statement primarily relates to central costs or exploration costs that cannot be capitalised. During the period oil and gas investments were revalued downwards by £615,000 (2020: £1,430,000).

4. EXPENSES BY NATURE AND AUDITOR REMUNERATION

Auditor's remuneration:

Tax and corporate finance services relating to the IPO were shared with the minority shareholders of GreenRoc Mining plc and respective shares of these costs are included within the Company's investment in GreenRoc Mining plc and the NCI share of assets.

Expenses by nature:

5. ACQUISITIONS, DISPOSAL, STRUCTURE CHANGES AND DILUTION WITHOUT LOSS OF CONTROL

Disposal of Brockham oil and gas asset

In June 2021 the Company announced that it was disposing of its 5% licence interest in the Brockham oil field to the Operator, Angus Energy. The consideration, in settlement of certain back costs and a contribution toward eventual abandonment costs, involved the payment by Alba to Angus of £32,000 plus VAT, settled as to £6,400 in cash and £32,000 by the issue of shares in Alba. The asset was fully written down in a prior period, and the net impact of the transaction was a loss of £9,000 within administrative expenses.

Acquisitions of non-controlling interests

On 21 July 2021 Alba announced the purchase of the non-controlling interests in Obsidian Mining Limited and White Fox Resources Limited, being 10% and 15% (49% with an agreed dilution applied for non-funding) respectively. Alba paid a total of £370,000 by the issue of shares for these non-controlling interests.

Under IFRS 3, for fully consolidated entities where the parent has control, any subsequent transactions in subsidiary equity interests between the parent and non-controlling interests (both acquisitions and disposals that do not result in a loss of control) are accounted for as equity transactions.

Consequently, there was no remeasurement of the net assets of the entities to fair value and the amounts paid are shown as additions in Note 12.

Group structure changes - GreenRoc Mining plc

On 28 September 2021 Alba sold its 100% holdings in Obsidian Mining Limited, White Eagle Resources Limited and White Fox Resources Limited to GreenRoc Mining plc for gross consideration of £5,950,000 in shares and £50,000 cash (offset against £50,000 unpaid on incorporation of that company).

As the Group did not lose control of the assets of the subsidiaries this transaction was not treated as a disposal in the consolidated accounts, and the fair valuation uplift accounted for by GreenRoc Mining plc in its group accounts has been eliminated within the Alba Group accounts.

The accounting for the transaction at Company level is shown below:

Dilution without loss of control

On the same date as the transaction above, GreenRoc Mining plc issued further shares in an Initial Public Offering ("IPO") on the AIM section of the London Stock Exchange to raise funds of £5.1 million. That transaction diluted Alba's holding in GreenRoc Mining plc and generated a Non-controlling interest ("NCI"). Alba retains 54% of GreenRoc Mining plc and fully consolidates it.

Where control is retained, dilution/partial disposal is accounted for in owners' equity and a specific reserve has been created in the consolidated accounts for the movement generated by the various consolidation entries.

6. DIRECTORS' EMOLUMENTS AND STAFF COSTS

During the period the Company had on average 10.1 (2020: 4.25) employees each month, being the Directors (who are the key management personnel) plus finance, geological and local site staff. Where eligible, Directors and other staff accrue benefits under a money purchase auto-enrolment scheme held in NEST.

* GreenRoc employees from 28 September 2021 only, so this is an average based on two months only.

**Group average number of employees includes five employees from GreenRoc as one is already counted in Alba's employee numbers.

Directors' remuneration:

Note 24 gives further details of transactions with the Directors.

During the year the Company granted warrants or options to the Directors as follows:

The warrants issued to Mr Brünner and Ms Henson have an exercise price of 0.5 pence per share. The warrants vest(ed) as follows: 4,000,000 each on 8 June 2021 and 8 December 2021 and can be exercised until 7 December 2023. Mr Brünner waived the rights to his warrants when he stepped down from the Board.

The total estimated value of the share-based remuneration provided to Directors was £50,000 (2020: £174,000). These values were derived from a Black Scholes model as described in Note 17. The warrants were granted when the share price was 0.41 pence per share and the warrants were valued at 0.031 pence. The warrant value was high as a proportion of market price due to the historic share price volatility.

7. INCOME TAXES

The UK corporation tax rate has been applied throughout the workings below as substantially all of the losses during the year (and historic losses in retained earnings) have been incurred by the parent or other companies resident in the UK for tax purposes. Using a weighted average rate would not change the effective tax rate.

a) Analysis of charge in the period

b) Factors affecting tax charge for the period

The tax assessed on the loss for the year before tax differs from the standard rate of corporation tax in the UK which is 19% (2020: 19%). The differences are explained below:

A deferred tax asset has not been recognised in respect of timing differences relating to tax losses and accelerated capital allowances, due to uncertainty that the potential asset will be recovered. The aggregated losses in each of the Group companies being Alba Mineral Resources plc and its subsidiaries as listed in Note 12 amounted to £6,436,000 before adjustments required by local tax rules and excluding losses on intra-group transactions (2020: £6,153,000).

8. EARNINGS PER SHARE

The calculation of the basic loss per share is calculated by dividing the consolidated loss attributable to the equity holders of the Company by the weighted average number of ordinary shares in issue during the year. The diluted earnings per share is the same as the basic earnings per share, as warrants/options are not dilutive due to the loss for the year.

9. PROPERTY, PLANT AND EQUIPMENT

The land is part of the Clogau gold project. At the year end the land is held at cost. No depreciation is charged as it is not a wasting asset. Plant is part of the Clogau gold project.

10. INTANGIBLE FIXED ASSETS

The Group's intangible fixed assets relate to the Welsh gold projects (Clogau, Dolgellau gold and Gwynfynydd) (£2,659,000), the Limerick base metals project that is fully impaired and the Greenland projects held by GreenRoc Mining plc (£3,451,000).

At the year end the amount of liabilities (being creditors and accruals) relating to the exploration and evaluation assets was £460,000.

The Development and Production asset disposed of during the period was the Group's 5% share of the Brockham Oil Project, which was fully written down in 2019. The disposal was made on 15 June 2021. Alba paid Angus Energy, the majority owner and operator of the project, £32,000 by issue of shares. That amount comprised Alba's share of the Plugging and Abandonment provision plus a settlement of invoices due for Alba's share of running costs.

11. INVESTMENTS

The above investment represents an investment in 18.1%* (2020: 18.1%) of the issued share capital of Horse Hill Developments Limited ("HHDL") and associated loans to that company accruing interest at variable rates linked to the Bank of England base rate. Those loans and interest are treated as part of the overall investment and as such are classified as fair value through the profit and loss. Any interest due is subsumed within the overall investment valuation (see Note 22).

HHDL is a private company with no stock quote. Historically share transactions in the stock have provided bases for valuing the investment. During the period under review there have been no share transactions in HHDL stock nor transactions in licence interests.

The majority owner and operator of HHDL, UK Oil & Gas plc (UKOG) recently announced its results for year ended 30 September 2021 including an impairment of its investment in HHDL based on net present value calculations (utilising an internally generated depletion curve that was independently reviewed). Costs were based on current costs less any anticipated savings. A long-term Brent oil price of US$91/bbl was used being the spot rate at the time of assessment, with a discount rate of 6.3% used being the weighted average costs of capital of Horse Hill Developments Ltd, the holding company of the producing well HH-1). There is inherent uncertainty in any oil field valuation due to the uncertainty of future oil price movements.

The Directors believe that the intrinsic value of the oil field has not been diminished but recognise that UKOG's impairment of its investment in HHDL is an indicator of impairment of the Group's investment in HHDL and that UKOG has access to more information for valuation purposes than the Group.

Accordingly the Directors derived an impairment charge mirroring the per percentage point impairment applied in UKOG's Report and Accounts, approximately £34,000 per percentage point held, resulting in an impairment charge for the year of £615,000 against the prior year Level 3 valuation of the underlying oil field (based on market transactions in comparable UK Onshore oil & gas fields with primary inputs being: the market prices of proven and contingent reserves in recent comparable transactions; oil in place ("OIP") from the HHDL Field Development Plan; and an estimated Recovery Factor, the two combined giving net recoverable oil for HHDL which was then be compared to market values. The Recovery Factor is the overall proportion of oil expected to be extracted from the field and is calculated using a number of inputs derived from the test production and published in the FDP).

This revised valuation is also a Level 3 valuation under the IFRS 9 hierarchy, as defined in Note 22.

The registered office of HHDL is: The Broadgate Tower, 8th Floor, 20 Primrose Street, London, EC2A 2EW.

*In a prior period the Company elected not to contribute its share of a cash call. As a result the Company's shareholding could be diluted but the impact would be minimal, the reduction being less than 0.1% of the total issued share capital of HHDL.

12. INVESTMENTS IN SUBSIDIARY UNDERTAKINGS

Upon adoption of IFRS 9 the company recognised a provision for expected credit loss against the loans due from subsidiaries. These loans are interest-free and have no agreed terms. For the purposes of IFRS 9 the loans were assumed to be repayable on demand.

The loans are assessed as being credit impaired on inception as the subsidiaries have no income other than the receipt of inter-company funding and as the loans are primarily used to fund the subsidiaries deferred exploration expenditure. The subsidiaries would only be able to repay the loans if they can either sell their exploration assets or develop them to the point at which the assets generate cash flows, both of which would take time to achieve. Therefore, at inception, it is known that the loans will not be able to be repaid in accordance with the loan terms (that is, on demand) and therefore they are assessed as being credit impaired.

Historic and current data has been used to derive a probability of default and this has been applied across the portfolio of loans.

As reported in Note 5 to the Accounts, during the period the Company disposed of three subsidiaries, whilst still retaining control, to another subsidiary, thus reorganising the Group. Part of the consideration for these subsidiaries was deemed as debt consideration for assignment of £2m of intercompany loans shown in the table above. The effective repayment of these loans to the Company reduced the percentage probability of default across the loan portfolio and reduced the total loan balance, so that a significant proportion of the provision was released during the period.

At 30 November 2021 the Company held the following interests in subsidiary undertakings, which are included in the consolidated financial statements:

GreenRoc Mining plc was incorporated as a wholly-owned subsidiary called Pole Star Resources plc in March 2021.

On 21 July 2021 Alba increased its holdings in Obsidian Mining Limited and White Fox Resources Limited to 100% by acquired non-controlling interests of 10% and 49% respectively.

On 28th September Alba transferred its 100% holdings in Obsidian Mining Limited, White Fox Resources Limited and White Eagle Resources Limited to GreenRoc Mining plc when it listed on AIM in exchange for a 54% share of the enlarged share capital of that company, retaining its interests indirectly.

The address of the registered office of Aurum Mineral Resources Ltd is c/o Hugh Lennon Associates, Unit 8&10 Church View, Cavan, Ireland.

The address of the registered office of Gold Mines of Wales Limited is 2 Mark Clos, La Rue de la Croix, St Clement, Jersey.

All the other companies have their registered office at 6th Floor, 60 Gracechurch Street, London EC3V 0HR.

Mauritania Ventures Limited has been treated as a subsidiary undertaking because the Company exercises dominant influence over the investment by virtue of having the casting vote at Board meetings.

Dragonfire Mining Limited owns a 90% holding in Gold Mines of Wales Limited, which company wholly owns GMOW (Holdings) Limited and its wholly owned subsidiary GMOW (Operations) Limited. Dragonfire Mining Limited holds a put and call option over the 10% of shares in Gold Mines of Wales Limited that it does not own and therefore consolidates these entities as though they are 100% owned.

13. TRADE AND OTHER RECEIVABLES

The fair value of trade and other receivables approximates to their book value. The called-up share capital not paid related to a placing on 25 November 2020 and settlement was made on 1 December 2020.

14. CASH AND CASH EQUIVALENTS

The fair value of cash at bank is the same as its carrying value.

15. TRADE AND OTHER PAYABLES

The fair value of trade and other payables approximates to their book value.

16. FINANCIAL LIABILITIES

The Company has no financial liabilities.

The derivative financial instrument is recognition of a liability in respect of the put and call option over the remaining 10% shareholding in the Clogau gold project which the Company does not own. The option is not yet effective as it is contingent on certain milestones in the project or earlier if by agreement with the other party.

During the period the Group revalued the option based on its original valuation at acquisition plus 10% of the cumulative exploration spend on the Clogau-St David's project since that date. This is the minimum management would expect to pay to acquire the 10% at 30 November 2021 should the option become effective and is their best estimate. The option expires on 24 August 2028.

This is level 3 valuation under the hierarchy of IFRS 9 based on management's best estimate - for details of the valuation hierarchy see Note 22.

17. CALLED UP SHARE CAPITAL

The Company's Articles do not specify authorised share capital. All issued ordinary shares carry equal rights. The deferred shares do not carry any rights to vote or dividend rights. In addition, holders of deferred shares will only be entitled to a payment on a return of capital or on a winding up of the Company after each of the holders of the ordinary shares have received a payment of £1,000,000 on each such share.

At the AGM on 28 April 2020 a resolution was passed to reduce the par value of its ordinary shares to £0.0001. This resulted in the creation of a new class of deferred shares at 0.09 pence. These deferred shares have the same rights as the original class of deferred shares (noted above). No new deferred shares were issued during the year.

During the year the Company issued ordinary shares as follows: