ALS.L Regulatory News (ALS)

Altus Strategies Plc / Index (EPIC): AIM (ALS) TSX-V (ALTS) OTCQX (ALTUF) / Sector: Mining

29 April 2022

Altus Strategies Plc

("Altus" or the "Company")

Audited Final Results

Altus Strategies Plc (AIM: ALS, TSX-V: ALTS, OTCQX: ALTUF) announces its audited final results for the year ended 31 December 2021. These are presented below and are available (along with the Company's 2021 Annual Report) to download on the Company's website at http://altus-strategies.com/investors/financials/ and on SEDAR at www.sedar.com.

Corporate highlights

· Acquisition of an effective 0.418% Net Smelter Return ("NSR") royalty on the Caserones copper mine ("Caserones") in northern Chile for US$34.1m

· Caserones royalty acquired via a strategic 50:50 partnership with NYSE-American and TSX-V listed EMX Royalty Corp ("EMX") through a Chilean special purpose vehicle ("SPV")

· Receipt of maiden royalty income of £1.7m (before tax) in respect of Q2 and Q3 2021 production at Caserones

· Acquisition of 24 royalty interests from Newcrest Mining Ltd ("Newcrest") for US$24.0m, including royalties on two producing gold mines, one near-producing gold mine and 21 development and exploration stage projects (23 of which are located in Australia and one in Côte d'Ivoire)

· Newcrest royalties acquisition undertaken through a strategic joint venture with private company AlphaStream Limited ("AlphaStream") through SPVs in United Arab Emirates and Australia; first close of the acquisition covering all assets except nine development and exploration stage assets for US$20.0m

· US$29 million strategic acquisition loan facility provided by the Company's largest shareholder La Mancha Fund SCSp ("La Mancha")

· Moroccan portfolio of 14 primarily silver and copper projects to be vended to Eastinco Mining and Exploration Plc ("Eastinco") subject to Eastinco listing on the Standard List of the London Stock Exchange; Altus to retain NSR royalty rights on all projects, to gain a royalty right on Musasa tantalum mine in Rwanda and to become a major shareholder of Eastinco

· Appointments to the senior management team strengthen the Company's corporate and technical capabilities across its key areas of operation:

o Mark Campbell appointed as Non-Executive Chairman of 100% owned subsidiary Akh Gold Holdings Ltd and General Manager (Egypt)

o Amilha Young appointed as Company Secretary and Legal Counsel

o Boubacar Thera appointed as Corporate Manager (Mali)

o David Hall appointed as Strategic Advisor (Egypt)

Operational highlights

· Expansion of activities into Egypt through award of gold exploration licences, forming four projects, totalling 1,565km2 located in the Eastern Desert through a competitive international bidding process; discovery of numerous hard rock artisanal gold workings from field reconnaissance at Gabal Om Ourada and Wadi Dubur projects

· Western Mali: High grade intersections including 21.9 grams per tonne ("g/t") gold ("Au") over 10.2m from 28m from diamond drilling ("DD") at Diba gold deposit in western Mali (results are down-the-hole and not true widths)

· Southern Mali: Gold resource exceeds one million ounces (17.3 million tonnes at 1.2 g/t Au for 665,000 inferred ounces and 9.2 million tonnes at 1.2 g/t Au for 360,000 indicated ounces) at Tabakorole gold project in Southern Mali under Joint Venture ("JV") with Australian Securities Exchange ("ASX") listed Marvel Gold Ltd ("Marvel Gold") (see Altus' news release "Gold Resource Exceeds One Million Ounces at Tabakorole in Southern Mali" dated 5 October 2021). Upgraded Mineral Resource Estimate ("MRE") generated a 24% increase in indicated ounces and 7% increase in inferred ounces, with 70% of deposit comprising the MRE within 150m of the surface; encouraging DD results and discovery of a potential new parallel zone of mineralisation; significant increase in JV landholding at Tabakorole (by 100km2 to 292km2)

· Morocco: Grant of 10 new exploration licences taking the Company's portfolio to 14 projects covering 824km2 targeting primarily copper and silver; discovery of high-grade copper and silver from reconnaissance exploration at the newly granted Azrar, Izougza and Tata projects

· Completion of strategic review of Bikoula iron project in southern Cameroon by Mining Plus UK Ltd ("Mining Plus") to determine next steps for project development

Financial highlights

· Completion in March 2021 of oversubscribed fundraising for £7.7m / C$13.4m at an issue price of £0.75 / C$1.30 per Ordinary Share with net proceeds primarily used to accelerate gold exploration programmes in Egypt and Mali

· Receipt of second tranche of 10 million shares in Canyon Resources Ltd ("Canyon") with a value at the time of £0.6m / C$1.1m

· Completion in December 2021 of oversubscribed fundraising for £19.8m / C$33.7m at an issue price of £0.535 / C$0.90 per Ordinary Share with net proceeds primarily used for completion of the Newcrest royalty acquisition

· Cash balance of £6.4m / C$10.9m as at 31 December 2021

· Cash outflow from operating activities of £7.9m / C$13.4m for the year

· Listed equity holdings of £1.7m / C$2.9m as at 31 December 2021

Post-period end

· Second and final close of the Newcrest royalties acquisition covering nine development and exploration stage assets located in Australia for consideration of US$4.0m

· Completion of 11,832m drilling programme at Diba and Lakanfla gold project with latest results of up to 1.27 g/t Au over 127m from 21m on the Lakanfla Central prospect and 1.81 g/t Au over 10m from 256m at the Diba NW prospect (results are down-the-hole and not true widths)

· Extension of La Mancha loan facility to 30 June 2022 with annualised interest rate increased to 10% plus the United States Dollar ("USD") London Inter-bank Offered Rate ("LIBOR")

· 1.0% Gross Revenue Royalty ("GRR") generated on Toura Nickel-Cobalt project in Côte d'Ivoire through sale of interest in local subsidiary to Firering Strategic Minerals Plc ("Firering") for €15,000

· Revised joint venture agreement signed with Marvel Gold whereby the Company regained a 100% interest in the Lakanfla licence in western Mali, located 5km east of the Company's Diba project, and reduced its interest in the Tabakorole gold project in southern Mali to 30%; Altus retains a 2.5% NSR royalty on the Tabakorole project

· Award of a ten year (renewable) mining licence at the Agdz project in central Morocco covering an area of 34.36km2, representing the area of copper and silver mineralisation discovered to date

· Award of a four year (renewable) 'small scale' mining licence at the Diba gold project in western Mali covering an area of 83.1km2, incorporating the Diba Deposit and other key prospects

Steven Poulton, Chief Executive of Altus, commented:

"2021 marked another milestone year for Altus. With the acquisition of an NSR royalty on the Caserones copper mine in Chile and receipt of the maiden royalty payment just a month after closing the deal transformed Altus into a revenue generating business. Later in the year, we acquired a portfolio of 24 royalty interests from Newcrest Mining Ltd. The Newcrest portfolio includes royalties on two producing gold mines, one near-producing gold mine and 21 development and exploration stage projects, bringing the Company's global portfolio to 33 royalty interests and 27 project interests across nine countries and nine metals.

"Operationally, our focus during the period was on advancing and de-risking our royalty generation assets, primarily in Mali and Egypt. In southern Mali, an updated independent Mineral Resource Estimate at the Tabakorole gold royalty and JV project reported that gold resources now exceed one million ounces and there remains significant potential for further growth in parallel zones, along strike and at depth. Elsewhere in western Mali, diamond drilling we completed at the Company's 100% owned Diba gold project returned impressive high-grade intersections and discovered new zones. Earlier this month, post-period, Altus was granted a small-scale gold mining licence for Diba; an important step as we now progress with an updated MRE and Preliminary Economic Assessment for the combined Diba & Lakanfla project. In Egypt, Altus was awarded highly prospective gold exploration licences totalling 1,565km2 in the Eastern Desert, which we consider has world class discovery potential. Systematic exploration and target evaluation is already underway across these projects.

"Altus is exceptionally well-positioned to progress with its royalty generation activities across Africa while also reviewing accretive royalty income acquisition opportunities. The Company has a strong pipeline of transactions under review and we intend to further enhance and diversify our portfolio in the coming years growing our revenue streams in parallel.

"2022 is on course to be another highly productive year for the Company and we look forward to providing further updates in due course."

For further information you are invited to visit the Company's website www.altus-strategies.com or contact:

About Altus Strategies Plc

Altus Strategies (AIM: ALS, TSX-V: ALTS & OTCQX: ALTUF) is a mining royalty company generating a diversified and precious metal focused portfolio of assets. Its differentiated approach of generating royalties on its own discoveries in Africa and acquiring royalties globally through financings and acquisitions with third parties, has attracted key institutional investor backing. Altus has established a global portfolio comprising 33 royalty interests and 27 project interests across nine countries and nine metals. The Company continues to assess royalty acquisition opportunities as well as actively advancing its portfolio of gold and base metal projects across Africa, as part of its 'boots on the ground' royalty generation strategy. Altus engages constructively with all stakeholders, working diligently to minimise its environmental impact and to promote positive economic and social outcomes in the communities where it operates. For further information, please visit www.altus-strategies.com.

Qualified Person

The technical disclosure in this regulatory announcement has been approved by Steven Poulton, Chief Executive of Altus. A graduate of the University of Southampton in Geology (Hons), he also holds a Master's degree from the Camborne School of Mines (Exeter University) in Mining Geology. He is a Fellow of the Institute of Materials, Minerals and Mining and has over 20 years of experience in mineral exploration and is a Qualified Person under the AIM rules and NI 43-101.

Cautionary Note Regarding Forward-Looking Statements

Certain information included in this announcement, including information relating to future financial or operating performance and other statements that express the expectations of the Directors or estimates of future performance constitute "forward-looking statements". These statements address future events and conditions and, as such, involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the statements. Such factors include, without limitation, the completion of planned expenditures, the ability to complete exploration programmes on schedule and the success of exploration programmes. Readers are cautioned not to place undue reliance on the forward-looking information, which speak only as of the date of this announcement and the forward-looking statements contained in this announcement are expressly qualified in their entirety by this cautionary statement.

Where the Company expresses or implies an expectation or belief as to future events or results, such expectation or belief is based on assumptions made in good faith and believed to have a reasonable basis. The forward-looking statements contained in this announcement are made as at the date hereof and the Company assumes no obligation to publicly update or revise any forward-looking information or any forward-looking statements contained in any other announcements whether as a result of new information, future events or otherwise, except as required under applicable law or regulations.

TSX Venture Exchange Disclaimer

Neither the TSX Venture Exchange nor the Investment Industry Regulatory Organisation of Canada accepts responsibility for the adequacy or accuracy of this release.

Market Abuse Regulation Disclosure

This announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018 ("MAR"), and is disclosed in accordance with the Company's obligations under Article 17 of MAR.

Chairman's Statement

Reflection on the year

I am delighted to be able to report on a steep and transformational growth trajectory for Altus during the past year. The long-held business strategy of holding a diverse portfolio of royalties and discovery projects took a series of strong steps forward in 2021.

Perhaps the most significant new development was the acquisition of an interest in a cash-paying royalty at the Caserones copper mine in northern Chile. Not only was this the initial example of the parallel strategies of royalty acquisition and royalty generation working together in the business, it was also the Company's first asset outside of Africa as well as being a first in terms of taking a joint venture approach with a royalty partner. Within a month of the acquisition, we were delighted to report that the first royalty revenue was received in Altus' bank account.

In the same month that the first Caserones royalty was received, the Company opened a branch office in Cairo. Having been notified of the success of its bid for approximately 1,550km2 of gold exploration licences in Egypt's highly prospective Eastern Desert, our team began setting up the operations of our Egyptian subsidiary, Akh Gold Limited. In just a few months, the Company has built a team of talented and well-connected local geologists and support staff, including the appointment of Mark Campbell as Akh Gold's General Manager. Having completed the formalities for officially receiving the exploration licences, the team has rapidly commenced reconnaissance work across the nine licence blocks that make up the four projects. The area covered by these four projects is vast and largely unexplored, and offers a fantastic opportunity for the Company to make some exciting discoveries. The exploration bid process in Egypt has attracted major industry players including Barrick Gold, Centamin and B2 Gold amongst others.

Caserones and Egypt together perfectly illustrate the parallel strategy of royalty acquisitions that, as well as providing short term returns, also contribute to the Company's discovery activities, which, over time, offer the prospect of significant shareholder returns. In the coming years the team at Altus will seek to maintain the optimal balance of short term capital returns and long term income exposure across our portfolio of assets.

Altus finished the year strongly with the acquisition of a significant, high quality portfolio of predominantly gold metals royalties in Australia and Côte d'Ivoire, including the cash-paying or near-production royalties at the Ballarat, SKO and Bonikro mines. Altus started the year holding nine royalties - it ended it holding 24, a great achievement and a substantial platform for the future of the Company.

Management and Board

For a company of our size, Altus has a strong and experienced senior management team, Board of Directors and corporate governance procedures. There were no changes to the composition of the Board during the year, but following the year end, Gérard de Hert was appointed as a non-executive director. Gérard is the Managing Director of Technical Services at La Mancha, our largest shareholder, and, in accordance with the Strategic Investment Agreement with La Mancha of February 2020, he represents La Mancha's second appointee to our Board alongside La Mancha's CEO Karim Nasr. Prior to joining La Mancha, Gérard held senior management positions with a number of Africa-focused multinational gold miners, and his technical expertise in the exploration and development of mines in Africa will be of considerable value to Altus. I welcome Gérard as a director and look forward to working with him.

During the year, a number of key management appointments were made that further strengthened the Company's corporate and technical capabilities in line with our growth. Amilha Young was appointed Company Secretary and Legal Counsel. Amilha has over 20 years' experience in corporate governance in the financial services and natural resources sectors in Africa and the UK. Mark Campbell who lives in Cairo joined as the General Manager in Egypt, a key appointment in the establishment of the Company's business in Egypt, and was also appointed Non-executive Chairman of Akh Gold Holdings Ltd. Mark has over 40 years' experience in the mining, investment banking and petroleum industries, with 31 of those years being in Egypt. Also in Egypt, David Hall joined us as Strategic Advisor for Egypt, bringing 35 years of experience in the exploration and mining sector assessing exploration projects and mines in over 55 countries. In Mali, Boubacar Thera was appointed as Corporate Manager, to support our operations there, specifically, as we advance our 100% owned Diba & Lakanfla gold project, and to enhance the Company's profile in the region. Boubacar is a Malian lawyer with over 25 years' professional experience in the natural resources industry in Africa focused on contract, joint venture and mining title negotiations.

After the year end, the Company's business development team was strengthened. Michael Starke was appointed VP Corporate Development to support the realisation of value from Altus' growing asset portfolio as well as to manage corporate communications. Michael has over 14 years' experience in corporate finance and will support Alister Hume, who was promoted to Chief Investment Officer, having played a pivotal role in the acquisitions of the Caserones royalty and the portfolio of royalties in Australia and Côte d'Ivoire from Newcrest.

Looking forward

The energetic team at Altus never lets the grass grow under its feet. Notwithstanding the effort that has gone into advancement of the Company along its strategic path during 2021, I have no doubt that the team will pursue new opportunities with diligence and resolve, and will work with intelligence and commitment to develop and grow Altus' exciting portfolio of royalties and projects.

On behalf of the Board, I thank the entire team at Altus for their contributions to a momentous year, and I thank our existing and new shareholders for their continued support.

David Netherway

Non-executive Chairman

Business Overview

Our royalty generator business model

Altus is a mining Royalty Generator focused on becoming a leading royalty business. The Company is based in the United Kingdom and dual-listed in the UK (AIM: ALS) and Canada (TSX-V: ALTS). Its shares also trade in the United States (OTCQX: ALTUF). The Company was founded by three of its current directors in 2007; namely Steven Poulton, Matthew Grainger and David Netherway. Since its formation, Altus has developed a portfolio of resource assets, diversified by commodity and jurisdiction and it has sought partnerships on our assets to further reduce risks and accelerate its growth. The team's track record of success in Africa and differentiated business model has also attracted notable institutional and other sophisticated investors. La Mancha is one such group, which joined the Company's register in 2020 as the largest shareholder with a 35% interest. As one of the world's largest and most respected mining investors, La Mancha's involvement has been transformational for the Company and the growth of both elements of its two-pronged strategy of generating royalties and increasing value per share, namely the Acquisition Strategy and the Discovery Strategy.

The Acquisition Strategy focuses on accelerating the growth of the Company's portfolio and cash flows through the acquisition of existing royalties on third party mines and development projects around the world, or by royalty creation through the provision of strategic capital to select mining and exploration companies. Our acquisition strategy aims to expand the Company's royalty portfolio, provide further diversification, maintain a high degree of quality assets to yield long term, sustainable income for Altus from cash-generating assets. This approach provides Altus with a steadily growing stream of lower-risk cash flows which it can deploy to further grow its royalty portfolio and to fund its discovery strategy.

The Discovery Strategy provides the Company's shareholders with exposure to the potentially significant outsized returns which can be generated from the success of targeted discovery work. Leveraging the Company's expertise and proven ability to identify and rapidly advance early-stage prospects, Altus aims to generate high-value projects by selectively acquiring multiple exploration licences in diverse jurisdictions and advance these through targeted appraisal undertaken by the Company's exploration geologists. As projects progress up the 'value curve', the Company typically enters JVs with third parties who fund advanced exploration and development, thereby reducing risk and preserving shareholder capital for investing in further opportunities. Income is generated through JV milestone payments which occur at exploration and development landmarks. As each project matures and develops, Altus' ownership may dilute but the Company looks to retain a minority equity position as well as a royalty, providing longer term optionality and cash flow potential once the project enters production.

Discovery Strategy focused on Africa

While Altus's acquisition strategy targets assets in all parts of the world, the Company's discovery strategy is focused on the continent of Africa where, due to the relative lack of exploration using modern techniques compared to many other parts of the world, economic mineral deposits can still be discovered close to and in many cases cropping out at surface.

It is reported that 24% of all discoveries in the last decade were found on the continent of Africa, despite it receiving only 14% of the global exploration budgets (source: MinEx Consulting). According to the same survey, deposits in Africa (excluding South Africa) are being discovered at average depths of just 9m below surface, which is much shallower than average global depths of 78m. In Canada and the USA the average discovery depths are even greater, at 125m and 198m respectively.

This opportunity to make discoveries across Africa without recourse to expensive subsurface exploration technologies, including drilling programmes, means that our shareholder capital can potentially generate more value and at greater speed if applied to exploration in Africa than it might in many other parts of the world, thus increasing the discovery potential per Altus share. Given the collective geographical, geological and operational expertise of our board, management and advisors, we believe Altus is well positioned to maximise this opportunity. The Company currently has interests in exploration licences in Egypt, Mali, Morocco, Cote d'Ivoire, Cameroon and Ethiopia.

Risk diversification

Risk diversification is at the heart of the Company's business model and is enacted by diversifying our asset portfolio across a variety of metals at different stages across several jurisdictions. Altus has a growing portfolio of 33 royalties comprising four royalties on producing mines, 15 royalties on development projects with mineral resources and 14 royalties on pre-resource projects, as of the publication date of this report. In addition to the royalty portfolio, the Company's project pipeline comprises 24 exploration projects, of which one is under JV (Tabakorole in Mali) while the Company's 14 Moroccan projects are in the process of being spun out into Eastinco Mining and Exploration plc which is seeking to list on the London Stock Exchange. Together, the Company's royalties and projects span nine countries and encompass nine commodities.

More than half of the Company's discovery portfolio is comprised of gold projects, the most advanced of which are located in western Mali. Aside from gold, Altus is focused on metals that it believes will be critical in the transmission, storage and efficient use of electricity in the coming decade, as the world seeks to decarbonise and implement 'Net Zero' policies. Copper will be paramount among these. Other metals such as nickel, cobalt, lithium, vanadium and aluminium also have a critical part to play, as will specialist and less well-known rare-earth metals, including neodymium and praseodymium that are used in the high-quality magnets of electric motors.

Chief Executive's Review

The year in summary

Acquisition of cash paying royalties

As our Chairman has highlighted, the acquisition of a royalty on the Caserones copper mine in northern Chile perhaps marked the most significant milestone for the Company in the year. Our team had been working hard to deliver on the Company's publicised parallel strategy of acquiring cash-paying royalties alongside generating our own royalties. This hard work came to fruition in August when an agreement was signed for the purchase of a 0.418% NSR copper royalty for $34.1 million. The Caserones mine is situated in a Tier-1 jurisdiction and at that time represented our first asset outside of Africa. The mine is owned and operated by JX Nippon Mining & Metals Corporation of Japan and had an estimated minimum 17 years of production remaining at the time of our NSR acquisition.

The Company was delighted to secure the acquisition of the Caserones royalty in partnership with NYSE-American and TSX-V listed EMX Royalty Corporation. Altus and EMX worked closely together on the deal and incorporated a special purpose vehicle in Chile which is jointly owned and managed by Altus and EMX. The Company's partnership with EMX is strengthened by Michael Winn, who is the Chairman of EMX, as well as being a Non-Executive Director of Altus.

The commitment made to the long-term development of Altus by our significant 35% shareholder, La Mancha, was underscored through the provision of a US$29.0 million acquisition bridge loan facility, which was drawn down to part-fund the acquisition. The facility, which was repayable in February 2022, has since been extended to 30 June 2022. The Company does not yet have alternative financing in place but has received a number of proposals to re-finance the loan.

Following the closing of the Caserones transaction, the team quickly moved on to its second acquisition of the year, which closed in December 2021. This deal saw Altus acquire interests in a portfolio of primarily precious metal royalties from Newcrest Mining Ltd for US$24 million. The portfolio includes two current gold mines and one near-production gold mine as well as 21 near-term development and exploration stage projects. All but one of the projects are located in Australia, further diversifying Altus' portfolio and adding another Tier-1 jurisdiction, the other is in Côte d'Ivoire, where Altus already holds royalties on two self-generated projects, one for gold and one for nickel-cobalt.

The first income from the Ballarat and SKO royalties in Australia was received in March 2022, which, together with Caserones, brought the quarterly gross income from royalties to approximately US$1.8 million.

For the transaction with Newcrest, Altus was delighted to be working with another royalty partner, AlphaStream Limited, a specialist mining royalty investment and streaming company. Altus and AlphaStream incorporated two SPV's one of which holds a 100% interest in an Australian subsidiary holding the Australian royalty assets, and the other which holds the royalty asset in Côte d'Ivoire directly.

The transaction with Newcrest was supported by a placing and subscription of new Ordinary Shares raising US$26.1 million from both existing as well as new institutional investors alongside a concurrent subscription by the Company's major shareholder, La Mancha, as well as various Altus directors, officers and other investors. Further details of the royalties acquired in Chile, Australia and Côte d'Ivoire are provided in the portfolio review on pages 31 to 34.

Our Portfolio of gold projects in Mali

The Company has made notable progress during the year on its Diba and Lakanfla gold project in western Mali, where a series of drilling programmes has been undertaken across the project targeting strike extensions and new zones of mineralisation. Altus took the decision to self-fund these drilling programmes to accelerate advancement of the project, and to build on the MRE and PEA produced by Mining Plus UK Ltd in 2020.

In January 2022 Altus regained 100% ownership of the Lakanfla licence from its joint venture partner Marvel Gold. Lakanfla is located just 5km east of the Diba licence and is considered to be highly prospective based on previous exploration programmes and the presence of substantial hard rock artisanal gold workings. The drilling programme was expanded to test the on strike and down-dip potential of the Diba Deposit, Diba NW prospect and the Lakanfla Central prospect. An updated MRE and PEA for the combined Diba and Lakanfla project will be prepared once the results from the drilling programmes have been assessed.

In southern Mali, progress has continued with our joint venture on the Tabakorole gold project funded by partner Marvel Gold. An updated MRE on Tabakorole was published in October 2021 and exceeded one million ounces, (comprising 17.3 million tonnes at 1.2 g/t Au for 665,000 ounces ("oz") in the Inferred category, 9.2 million tonnes at 1.2 g/t Au for 360,000oz in the Indicated category). This is a major milestone for the project, and includes 70% of the upgraded MRE being within 150m of surface complemented by high metallurgical gold recoveries averaging 97%. Tabakorole is shaping up to be a potentially significant gold development project in west Africa with substantial upside for Altus. At the year end, Altus held a 49% interest in Tabakorole, which has since been reduced to 30% in line with the JV agreement. Altus holds a 2.5% NSR royalty on the Tabakorole project.

A new portfolio of gold projects in Egypt

The establishment of operations in Egypt in 2021 represents perhaps the most significant expansion of our activities since our plan of arrangement with TSX-V listed Legend Gold in 2018 for its portfolio of gold projects in Mali. Nine licences were awarded to Altus in Egypt in 2021, from the internationally competitive inaugural licence bid round process. The licences form four distinct project areas and cover a substantial area of the highly prospective Eastern Desert. By the end of the year, exploration was already underway on two of the projects, namely Gabal Al-Shaluhl and Wadi Dubur, representing 1,044km2 of the 1,565km2 of the Company's licence base in Egypt.

The ramp up of operations has been swift. An office has been set up in Cairo managed by Mark Campbell, our newly appointed General Manager in Egypt, ably supported by an enthusiastic and well-connected technical and administrative team. The Company is also delighted to have David Hall on the team, as Strategic Advisor for Egypt.

I am extremely pleased with the development of our growing and high-calibre team in Egypt and confident that they will make rapid progress in advancing our projects in the coming year. While exploration is still in its early stages, our initial reconnaissance is revealing a high incidence of hard rock artisanal gold workings within highly prospective geological belts which underscore the very high prospectivity of our licences.

Further details of the Company's discovery assets are provided in the Portfolio Review - Discovery Projects Portfolio on pages 36 to 48.

Divestment of Moroccan silver and base metal portfolio

Our royalty generation business is dynamic and predicated on our ability to make new mineral discoveries and monetise these for royalty interests, plus cash and equity. The sale of the Company's fourteen, primarily copper and silver, exploration projects in Morocco is in line with this strategy. We signed an agreement with Eastinco in November 2021 to divest Altus' interest in its Moroccan projects. Subject to the admission of the shares of Eastinco onto the LSE Standard List, Altus will become a material shareholder of Eastinco holding up to 25% of the issued capital, receive a reimbursement of up to £250,000 in respect of exploration expenditures incurred and retain a 2.5% NSR royalty interest on each of the Moroccan projects. Altus will also obtain an NSR royalty interest in Eastinco's producing Musasa tantalum project in Rwanda.

Funding

The Company completed two successful equity fundraisings during the year, raising a total of £27.5 million before expenses. The first of these, in March 2021, was undertaken to support the development of the Company's royalty generation assets, principally in Mali and Egypt. The second, completed in December 2021, provided funding for the acquisition of the portfolio of royalties from Newcrest. A number of existing investors participated in the equity fundraisings, including our cornerstone shareholder La Mancha, and we also welcomed several new and notable institutional investors to our register. A number of directors and senior managers also participated in the fundraisings.

La Mancha further demonstrated its strategic support for the Company through the provision of a US$29 million strategic acquisition debt facility to partly fund the acquisition of the Caserones royalty. This was the Company's first such use of debt funding and it was fundamental to catalysing our royalty acquisition strategy.

Market positioning

The Altus portfolio of royalties and projects is weighted towards gold, with exposure being over 50%. Gold remains the ultimate liquid "safe-haven" for investors seeking protection from heightened geopolitical risks and the value-destructive impacts of inflation on cash and cash-like investments.

The gold price started the year at around $1,900/oz, eased to around $1,700/oz by early March before recovering to around $1,800/oz, where it remained for much of 2021. Following the Russian incursion in Ukraine in early March 2022, gold rose briefly almost touching $2,100/oz before falling back closer to $1,900/oz. Our portfolio of cash paying and development stage gold royalties which Altus acquired from Newcrest in December 2021, provides our shareholders with direct and relatively low risk exposure to the current and future strength in the price of gold.

Notwithstanding the concerning situation in Ukraine and its wider geopolitical and inflationary implications, the world's major economies continue to promote an agenda to decarbonise the global economy with a "Net Zero" target. This objective will have potentially transformational, and perhaps yet to be fully appreciated, implications for the demand for copper, nickel and rare earth metals given their fundamental role in the generation, transmission and consumption of renewable energy. Altus continues to seek to increase its exposure to these metals and others which also stand to benefit from a post-Covid-19 recovery in global growth and infrastructure development. Already, there has been a sustained surge in the prices of many commodities, as global supply chains restock and government infrastructure spending increases. The copper price was on an upward trend at the start of the year, opening at around US$3.50 per pound ("lb"). It broke through US$4.00/lb in early February and remained above this threshold for the rest of 2021, dipping close to US$4.00/lb again in April and July, but climbing above US$4.70/lb in May and October. It too soared in early March 2022 to above US$4.90/lb before falling back slightly. Our ownership of a strategic royalty interest on the Caserones copper mine in Chile, acquired by Altus for US$34.5 Million in August 2021, provides our shareholders with direct and relatively low risk exposure to the current and future strength in the price of copper.

In response to accelerating inflation, central banks around the world have now started, arguably belatedly, to raise interest rates with the chairs of central banks guiding that more aggressive interest rate rises may be required in the months and years ahead. Should confidence in economic growth fall for whatever reason, in a period of rising interest rates and excessive (government, corporate and personal) debt, the potential for a substantial economic reset will be significant. Gold continues to represent the ultimate hedge against the potential dramatic consequences of a systemic debt driven financial crisis, as well as the impacts of real negative interests, for as long as inflation rates continue to exceed interest rates.

Outlook

This has been another transformational year for Altus and our asset portfolio. We have completed two landmark transactions to acquire cash paying royalties, received our maiden royalty income from these, expanded our discovery portfolio into the highly prospective Eastern Desert of Egypt, advanced our the Diba & Lakanfla gold project in Mali though successful drilling programmes, structured the divestment and royalty creation on our Moroccan portfolio of assets and embodied the Company's strategy of generating growth for shareholders through diversification.

Commodity markets are being pushed higher by the drive to decarbonise, the post-covid global recovery and by geopolitical events. The growth of Altus over the past year and the balance of assets in our portfolio puts us in a strong position to not just meet the challenges ahead, but to generate superior performance for our shareholders.

Our key objectives for 2022 are to:

- continue to grow the Company's revenues with the acquisition of further cash-paying royalties;

- continue to grow and realise value from our royalty generation activities across Africa;

- to conduct business with due regard for the Company's stakeholders and our environmental as well as social responsibilities.

Our long-term objective is to realise substantial returns for shareholders, by generating significant positive cashflow from a diversified portfolio of high-quality royalty and project interests. Altus has never had a stronger asset base, team or outlook and I very much look forward to the year ahead.

In the meantime, I take this opportunity to thank all of the Altus team for their exceptionally hard work and dedication throughout what has been an extraordinarily busy year. I also take this opportunity to thank our new and existing shareholders for their continued support.

Steven Poulton

Chief Executive Officer

Strategic Report

Key Performance Indicators

The Board uses a mixture of financial and non-financial Key Performance Indicators ("KPIs") to help monitor the performance of Altus' group of companies (the "Group"). The following four categories of KPI's are used to assess the Group's performance:

1. Health, Safety, Environment and Communities (HSEC)

2. Portfolio growth and diversity

3. Financial KPIs

4. Share price performance

1. Health, Safety, Environment and Communities (HSEC)

The health and safety of our employees, contractors and suppliers is core to how we conduct our business. The Group promotes a strong culture of health and safety to ensure individuals take responsibility for doing the right work in the right way and ensure any breaches of this are recorded. This culture is supported by comprehensive processes, training and personal protective equipment to ensure a safe and healthy working environment. In 2021, the Group achieved a Lost Time Injury Frequency Rate (LTIFR) of 0 (2020: 0). LTIFR is calculated as (Number of lost time injuries in the reporting period x 1,000,000 ÷ Total hours worked in the reporting period). The Group's drilling contractor at the Diba project had one on site incident resulting in one day of lost time for one of its employees. This is reportable under the contractor's Health and Safety statistics.

The Group has implemented an Environmental Management Plan in relation to its active exploration operations in several countries in Africa. The exploration process involves the short-term collection of small volumes of physical data from the earth including soil sampling, channel sampling, trenching and drilling. The potential impact to the environment from these activities is relatively minor, but includes very limited emissions to soil, water and air. Under the Group's Environmental Management Plan, potential emissions are mitigated in all circumstances in order to reduce any impacts. The Group has a goal of ensuring no significant environmental incidents across its operations with none reported in the year to 31 December 2021 (2020: none).

As part of its exploration operations in several countries in Africa, the Group ensures its "Social Licence to Operate" by building and maintaining strong relationships with the communities in which it operates. Through its programme of community engagement, the Group ensures effective two-way communication and resolution of potential issues.

2. Portfolio growth and diversity

The Group has a two-pronged approach to generating royalties, namely via its acquisition strategy and its discovery strategy. The KPI relating to the operational performance of each of these strategies focuses on the management of the existing portfolio of assets as well as the growth of the portfolio. The Group continually assesses potential licence applications, projects and third-party royalty acquisitions in new jurisdictions.

The Group's discovery strategy is underpinned by a solid pipeline of project across a number of commodities and jurisdictions. In February 2021, the Group was awarded nine gold exploration licences in Egypt and between March and July 2021, the Group was awarded ten licences, primarily for copper and silver, in Morocco.

Risk diversification is a key part of the Group's business model. This is achieved through both geographic diversification as well as commodity diversification.

Aside from gold, the Group is focusing on metals that it believes will be critical in the increasingly decarbonised electricity industry, particularly copper. The Group also has interests in nickel, zinc, iron ore, silver and bauxite projects. The Group's single largest exposure by country and by mineral in terms of the number of royalties and projects in its portfolio is as follows.

3. Financial KPIs

The financial performance of the Group's asset portfolio is another important KPI and is focused on the management of income and expenditure associated with the implementation and advancement of each of these strategies. The Group focuses its expenditure on its most prospective opportunities for growth, and seeks to reduce project costs by pursuing potential JV and project sale transactions across its portfolio. Royalty income in 2021 was through an associate of the Group and is included under share of profit of associate in the Statement of Comprehensive Income.

Exploration costs includes geologists, on site costs, assays/analysis and exploration support costs in Africa, as well as UK geologists' salaries, and an allocation of UK management time and UK exploration support costs. There was a significant acceleration of exploration activity on the Group's projects in Mali during the year. The UK support team was expanded, and this increased the proportion of exploration expenditure in overall costs.

The following is a breakdown of costs included in loss from operations in the Statement of Comprehensive Income (excluding foreign exchange losses and share based payments).

The Group focuses on deploying its cash on activities that are likely to maximise the value to shareholders while maintaining a strict control on administrative overheads. The Group's cash on hand and investments in marketable securities at 31 December (see table below) are sufficient to fund all projected expenditure for a minimum of 12 months from the date of this report.

4. Share price performance

The Company's share price performance broadly reflects the market appetite for the equity of resource companies and specifically for the Group's asset portfolio and growth prospects. In addition to providing returns to shareholders, a higher market valuation reduces the cost of capital for existing shareholders by reducing the amount of dilution when raising new capital through the issuance of equity. The remuneration of certain directors, management and other employees is part settled through the award of share options, further aligning the interests of shareholders and the Company's employees.

Principal Risks and Uncertainties

Corporate and Social Responsibility

The Board of Directors of Altus is committed to the consideration of all stakeholders in its decision-making process and to the respectful treatment of stakeholders in the conduct of the Group's business. In addition, the Directors are conscious of the obligations imposed by section 172 of the Companies Act 2006 (England & Wales), their response to which is set out in the following paragraphs.

Sustainability and environmental protection

Altus is committed to conducting its business operations in a sustainable manner and strives continuously to limit the impact of its activities on the natural environment and on the local communities in the regions where it has operations. The business of Altus involves the acquisition and generation of royalties on producing mines as well as exploration activities on potential mining projects, and does not involve mining itself. Therefore, the environmental impact directly associated with its activities is limited. However, the Company is keenly aware that good environmental stewardship of its projects is fundamental to its operations, and the Company endeavours to ensure that all areas it explores are properly maintained, and conserved, and rehabilitated once operations are completed.

A central tenet of the Group's policy is the Environmental Management Plan ("EMP"), which guides the Group's on-site activities from the planning stage through on-site operation to the return of sites to local communities once the Group's activity has finished.

Many of the areas of operation are regions of subsistence farming, and Altus and its employees are conscious that the impact of operations may not be limited to nuisance or upset, but could have a serious impact on the livelihoods of local people. As a result, the Group operates a number of policies to prevent problems and to remediate those that cannot be avoided. Where arable or grazing land is affected, rates of compensation are agreed with the local authorities before any invasive activity begins. Meetings are held with local stakeholder groups to explain the project, to listen to local concerns and to mitigate any potential problems. At the other end of the project cycle, once activities have ceased, the Group arranges for replanting of crops or the promotion of flora re-growth, and returns to monitor progress after six months.

At the Diba gold project in western Mali, the Group applied its EMP to the drilling programmes undertaken during 2021. At Diba NW, the Group delayed commencing its drilling programme until after the harvest had been collected, and the team was given a radius of operations for each drill pad to give scope to avoid cutting down trees. Avoidance of damage is always the preferable option, but at Diba, where for approximately a quarter of the drill-pad movements it was not possible to avoid affecting farming land, compensation was paid to farmers at rates agreed with the local community before the programme commenced. Post-drilling, sites were inspected to ensure all waste material had been removed, diamond drilling sumps had been filled and ground had been levelled and raked.

The Board and management consider the potential ESG impact of its discovery business to be relatively low. This is based on the minimal footprint of these operations, particularly in terms of the limited scope and duration of the Company's own field activities. Nevertheless, the Group's portfolio of royalties includes royalties on mines which are already in development or production. These operations have the potential for a more significant environmental and social impression. As such, the Company ensures a programme of acquisition due diligence as well as ongoing monitoring and assessment of these assets. The Group acquired its first cash-paying royalty, which is located in Chile, in August 2021 and a further two cash-paying royalties (each located in Australia) in December 2021. In conducting its due diligence on these projects, the Group assessed the available information on aspects of ESG processes and management.

The Group is putting into practice a programme for the effective management of its ESG responsibilities with respect to assets it does not itself control. This will include engagement with mining operators for the purpose of sharing policies, and identifying and encouraging best practice. The Company will seek to have an effective positive influence wherever possible. It will be the specified responsibility of a team within the Company to monitor third-party operators from an ESG perspective, and to obtain a comprehensive and, where possible, independent picture in order to form a fair opinion. On an ongoing basis, the Company will assess the effectiveness of its portfolio of third-party royalty assets through an ESG lens and not just in terms of financial performance.

Community engagement

Altus is mindful that it has the capacity to have a positive impact in its areas of operation, many of which are remote and offer little alternative opportunity to local people. It employs a range of local people from trained geologists to administrative support and drivers. At the end of 2021, it employed 30 people in five African countries (2020: 16 people in four countries). To some of the local people in the more rural sites, Altus offers the opportunity to be involved in the exploration activity and to gain transferable skills, such as operating geotechnical equipment. Before the declaration of force majeure, Altus also assisted students of geology from the University at Mekele in Ethiopia to visit its exploration sites.

In August 2021, Altus completed the first phase of a community development programme ("CDP") at the Diba gold project in western Mali. Altus undertook a consultation process with representatives of the local communities close to Diba in order to prioritise programmes that would have the greatest positive impact. Following this consultation, the specialist environmental company, EBEF-Mali, was commissioned to install a low-maintenance system to provide safe drinking water on tap to the school and nearby village of Koropoto, which is located 2km to the east of the project, outside of the current Diba licence area. The project involved drilling a 72.5m borehole, construction of a 12m high water tank with a solar-powered water pump and installation of all other necessary infrastructure. The CDP will prioritise other health as well as education projects, and in time will be extended to other communities in the surrounding area.

Anti-corruption and bribery

It is the Group's policy to conduct its business in an honest and ethical manner. The Group takes a zero-tolerance approach to bribery and corruption and is committed to acting professionally, fairly and with integrity in all business dealings and relationships in our countries of operation. As part of this, it aims to implement and enforce effective systems to counter potential bribery and corruption.

The Group will uphold all laws relevant to countering bribery and corruption in the jurisdictions in which we operate. We also remain bound by UK laws, including the Bribery Act 2010, in respect of our conduct both in the UK and abroad. The Group's policy on Anti-corruption and bribery is available via the Company's website and forms an important part of the appointment of all new employees, contractors and suppliers.

Human rights

Altus is committed to best practice in socially and morally responsible exploration and in the development of mineral resources for the benefit of all stakeholders. The activities of the Group are undertaken in line with applicable laws on human rights.

Health & Safety

Altus takes the health and wellbeing of its employees, contractors and suppliers extremely seriously and works continuously to minimise the potential hazards encountered. A comprehensive health and safety programme is maintained incorporating official guidelines, industry best practice, lessons from previous incidents and employee suggestions.

There have been no road traffic accidents affecting the Group during the last three years of operation, although there was one in each of the two preceding years, both involving third party drivers and vehicles. While Altus could not have prevented these accidents, they reiterated the importance of high safety standards. Altus continues to review all of its standards regularly and to ensure its suppliers and service providers adhere to these at all times.

Employees

Altus fully appreciates that its team is central to its future development and success. The aim of the Group is to create an environment that will attract and retain staff, and motivate employees to maximise their potential. The Company provides a fair remuneration package, and gives due consideration to requests for flexible working arrangements. It aims to give employees exposure to wider aspects of the Company's operations. The Group promotes a culture of openness among its employees and welcomes their input into the good running of its operations.

In line with its commitment towards a gender balance in its workforce, Altus has engaged with the Women in Mining ("WIM") group, both in the UK and internationally. Annually, the Group offers at least one internship through WIM. At the end of 2021, the following numbers were represented on the Company's team (includes employees and contractors).

Altus has a long track record in recruiting and training promising geologists. Each year the Group typically offers at least one MSc level project thesis to students of geology or mining geology in the UK. The Group is also proud to provide internships for recent graduates, allowing them to gain flexible work experience and if available the opportunity for a full-time role with the Group.

The Group welcomes diversity within its workforce and does not discriminate against its employees, workers or job applicants on the grounds of age, gender, ethnicity, disability, nationality, race, sexual orientation or religious belief.

Financial Review

Income

Due to the holding structure of the Group's royalty assets, income from royalties received in 2021 was recognised in the Statement of Comprehensive Income under share of profit of associates which is detailed in note 21. The share of profit of associates was £985,000 for the year (2020: £nil) and related solely to the royalty on the Caserones copper mine in northern Chile. The associate in question is SLM California, registered in Chile, in which Altus holds a 21.5% interest through its joint operation with EMX. The profit figure includes the royalty from the mine, amortisation of the royalty asset based on quarterly production figures, minimal local expenses and a provision for Chilean income tax. The profit relates to royalties declared in Q3 and Q4 of 2021 in respect of production in the preceding quarters.

Revenue and costs recovered from JV partners decreased to £318,000 (2020: £361,000) as a result of the JV with Marvel Gold covering the Lakanfla and Tabakorole projects in western and southern Mali progressing during the year to a stage where the Company no longer charges management fees or incurs rechargeable costs.

Expenses

Exploration costs expensed in the Statement of Comprehensive Income increased to £3,206,000 (2020: £2,350,000). This was driven to a large extent by costs associated with the drilling programmes on the Company's Diba gold project in western Mali. Although drilling costs themselves were lower at £725,000 (2020: £891,000), costs of associated assays increased from £49,000 to £297,000 and other on-site operational costs, principally at Diba but to a lesser extent also on the Company's four new projects in Egypt, resulted in an increase from £95,000 to £313,000. The split between exploration costs recovered from JV partners and those borne by the Company is shown in note 7 to the financial statements.

Expenditure relating to projects in Mali was £1,876,000 which accounted for 59% of total exploration costs (2020: £1,497,000 and 64%). The Company commenced the establishment of operations in Egypt in the spring of 2021, opening an office in Cairo in September, and sending its first geologists to site in the fourth quarter. Exploration expenditure in Egypt was £425,000 in the year, which represented 13% of the Company's total (2020: £8,000 which was force majeure for the whole of 2021, and in Côte d'Ivoire to £6,000 (2020: £58,000) following the sale of the Company's Prikro gold project in November 2020.

Staff costs for UK-based geologists and the corporate team increased to £1,328,000 (2020: £997,000), which took staff costs for the Group to £1,873,000 (2020: £1,210,000). A key element of the increase was the new team in Egypt, which by the end of 2021 included a General Manager, five geologists and a logistics and administration support team in Cairo. Another element was the continued development of the team in the UK, which included the appointment of a full-time Company Secretary and Legal Counsel, and full-year salaries for those people hired in the course of 2020. The Company furloughed two members of technical staff for a short period in 2020, and there were no redundancies as a result of the pandemic. Staff costs including share-based payments increased to £2,851,000 (2020: £1,814,000) mainly resulting from the full year, fair value charge for share options granted in August 2020.

Administrative expenses in the Statement of Comprehensive Income increased to £1,789,000 (2020: £849,000), and excluding impairment charges on intangible assets were £1,219,000 (2020: £828,000). This included the increase in staff costs as well as costs of a second broker to the Company in the UK, the use of advisors to make improvements in shareholder communications and higher insurance premiums. There was a renewed attendance at industry conferences and events as travel restrictions were lifted, and additional premises costs for the Company's new office in Cairo. There was a reduction in external legal costs as work was brought in-house.

Listing and acquisition related costs for the year increased to £443,000 (2020: £88,000), which included in-house and external legal fees, tax advice and stamp duty for the royalty acquisitions in Chile, Côte d'Ivoire and Australia.

Other income and costs

Other operating costs increased to £1,255,000 (2020: £993,000) and included a share based payment charge of £982,000 (2020: £664,000) resulting from the valuation of share options granted to Directors and employees in August 2020 and August 2021, and a foreign exchange loss of £273,000 (2020: £329,000) which was mainly an accounting translation of cash balances into the functional currency rather than a realised loss.

Other income reduced to £227,000 (2020: £1,939,000) which was principally made up of the accrued UK Research & Development ("R&D") tax credit for the 2020 tax year that was filed at the end of 2021 and received in January 2022. The Group recorded a gain on revaluation of its three external investment holdings during the year of £45,000 (2020: £162,000 loss).

Assets and cash

The net assets of the Group increased to £31,862,000 (2020: £10,301,000) which was reflected in the creation of a new line in the Company's balance sheet valued at £25,367,000 for investments in associates, a higher value of investments in external investments of £1,721,000 (2020: £1,321,000) and higher intangible assets of £16,994,000 (2020: £3,277,000), offset by the addition of borrowings of £18,349,000 (2020: £nil).

Investments in associates comprises the Group's interests in two companies, SLM California in Chile and Legend Gold Mali SARL in Mali. SLM California is the entity holding the Caserones royalty in which Altus acquired a 21.5% interest in August 2021 for US$34.1 million. Legend Gold Mali SARL is the entity holding the Lakanfla and Tabakorole exploration licences interests which were the subject of a JV with Marvel Gold throughout 2021. Under the terms of the JV, the Group's interest in the entity reduced to 49% upon completion of a certain project stage, from which point the entity was derecognised as a subsidiary and recognised as an associate. Following the end of the period the Lakanfla licence was removed from the JV with Marvel Gold and the Company's interest in the UK incorporate JV holding company was reduced to 30%.

The increase in the balance of external investments was due to the receipt of a final tranche of 10 million shares of ASX-listed Canyon arising from the termination of the JV agreement in 2019.

The increase in the balance of intangible assets was due to the acquisition of the portfolio of royalty assets from Newcrest, the first close of which took place in December 2021 for a value of US$20.0 million. This included the Ballarat and SKO royalties in Australia and the Bonikro royalty in Côte d'Ivoire, as well as royalties on 12 development and exploration stage assets in Australia. The increase was offset by the full impairment of the Pitiangoma Est licence in southern Mali which was relinquished during the year, and due to the Lakanfla and Tabakorole projects ceasing to be recognised as intangible assets, instead being recognised as part of the investment in associate, Legend Gold, as detailed above. The Caserones royalty is accounted for as an intangible asset of its associate company, SLM California, and appears in the balance sheet under investment in associate rather than intangible assets.

The addition of a line in the balance sheet for borrowings represents the receipt of the US$29.0 million loan to the Group by La Mancha, which was used to partly fund the Caserones royalty acquisition. Of the balance of the facility drawn down, US$5.0 million was repaid during the year.

The Group's cash balance at the end of the year was £6,355,000 (2020: £5,937,000). Operating cash outflow increased to £3,245,000 (2020: £2,348,000) comprising an adjusted loss figure of £3,834,000 and positive movements in working capital of £589,000. Investing cash outflow was £40,315,000 (2020: £104,000) primarily for the acquisition of the Caserones royalty and Newcrest royalty portfolio, and also including £614,000 for interest on the loan provided by La Mancha. Financing cash inflow was £43,978,000 arising from the two equity fundraises, in March and December 2021, and the loan from La Mancha.

Fundraising

During the year, the Company raised a total £27.5 million (C$47.1 million) in two equity fundraisings. In March 2021, the Company raised £7.7 million (C$13.4 million) through a placement of 10,266,668 Ordinary Shares of the Company at a price of £0.75 (C$1.30) per share with existing and new institutional and private investors. La Mancha and certain directors and employees of the Group participated in the placement. The fundraising was led by joint brokers in the UK, SP Angel and Shard. The issue price of the new Ordinary Shares represented a discount of approximately 8.0% to the closing mid-market price of £0.815 / C$1.41 on 19 March 2021.

In December 2021, the Company raised £19.8 million (C$33.7 million) before expenses through a placement of 36,930,143 Ordinary Shares of the Company at a price of £0.535 (C$0.90) per share with existing and new institutional and private investors. La Mancha and certain directors and employees of the Group participated in the placement. BMO Capital Markets Limited acted as Sole Bookrunner with SP Angel and Shard acting as Lead Managers and Sprott Global Resource Investments Ltd acted as a finder in respect of some of the subscription shares. The issue price of the new Ordinary Shares represented a discount of approximately 7.0% to the closing mid-market price of £0.575 / C$1.01 on 14 December 2021.

Going concern

The Directors have assessed the cash resources available to the Company, including balances of cash and investments held in publicly traded companies at the reporting date. They have reviewed a detailed 24-month budget prepared by the Company, assessing the likelihood of receiving projected royalty and other income, debt coverage and the breakdown between committed and discretionary projected expenditure. Given the Company's previous statement of the low impact of Covid-19 on operations in the short-to-medium term, a renewed outbreak of Covid-19 has not been included in the analysis. Based on their assessment, the Directors anticipate that net income from the current portfolio of royalties is unlikely to be sufficient to cover exploration and other costs of the business over the next 12 months and that in that period the Company may have to raise additional funding. In making their assessment, the Directors acknowledged the existence of a number of material uncertainties including volatility in financial and commodity markets, and political and security risks. These and other risks faced by the Company are outlined in detail in the Strategic Report on pages 21 to 23.

The Company's loan liability to La Mancha, the balance of which was £18.3 million at 31 December 2021, is repayable by 30 June 2022. As at the date of this report, a re-financing of the loan has not been put in place. The Directors note that, were the Company unable to secure a re-financing of the loan, it could potentially impact the Company's ability to maintain its current business operations, and acknowledge that this constitutes a material uncertainty. However, the Directors also note that Altus has received a number of proposals to re-finance the loan before 30 June 2022, and they remain confident that the necessary funding will be secured.

Based on their assessment, the Directors have, at the time of approving the financial statements, a reasonable expectation that the Group will have adequate resources to continue in operational existence for the foreseeable future. Therefore, the Directors continue to adopt the going concern basis of accounting in preparing the financial statements.

Independent Auditor's Report to the Members of Altus Strategies plc

Opinion

We have audited the financial statements of Altus Strategies plc (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 December 2021 which comprise the Group Statement of Comprehensive Income, the Group and Company Statement of Financial Position, the Group and Company Statement of Changes in Equity, the Group and Company Statement of Cash Flows and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and UK-adopted international accounting standards and as regards the parent company financial statements, as applied in accordance with the provisions of the Companies Act 2006.

In our opinion:

· the financial statements give a true and fair view of the state of the group's and of the parent company's affairs as at 31 December 2021 and of the group's loss for the year then ended;

· the group financial statements have been properly prepared in accordance with UK-adopted international accounting standards;

· the parent company financial statements have been properly prepared in accordance with UK-adopted international accounting standards and as applied in accordance with the provisions of the Companies Act 2006; and

· the financial statements have been prepared in accordance with the requirements of the Companies Act 2006.

Separate opinion in relation to IFRSs as issued by the IASB

As explained in note 1 to the group financial statements, the group, in addition to complying with its legal obligation to apply UK-adopted international accounting standards, has also applied IFRSs as issued by the International Accounting Standards Board (IASB).

In our opinion the group financial statements give a true and fair view of the consolidated financial position of the group as at 31 December 2021 and of its consolidated financial performance and its cash flows for the year then ended in accordance with IFRSs as issued by the IASB.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the group and parent company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC's Ethical Standard as applied to listed entities, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Material uncertainty related to going concern

We draw attention to note 1 in the financial statements, which indicates that the Group is reliant on additional raising of capital or financing to refinance the existing debt facility in the going concern period. As stated in note 1, these events or conditions 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.

In auditing the financial statements, we have concluded that the director's use of the going concern basis of accounting in the preparation of the financial statements is appropriate. Our evaluation of the directors' assessment of the company's ability to continue to adopt the going concern basis of accounting included reviewing the group's existing financing arrangements, the ongoing refinancing, forecasts and assumptions used in their preparation. Our work included comparing these forecasts to actual results and significant events subsequent to the year end.

Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.

Our application of materiality

The scope of our audit was influenced by our application of materiality. The quantitative and qualitative thresholds for materiality determine the scope of our audit and the nature, timing and extent of our audit procedures. The materiality applied to the group financial statements was £275,000 (2020: £200,000), based on thresholds for net assets and the loss before tax. The benchmarks used and the percentages applied are unchanged from the prior period and were selected as the intangible assets and exploration costs are the primary drivers of the business. The performance materiality was £192,500 (2020: £140,000) and triviality of £13,750 (2020: £10,000). The materiality applied to the parent company financial statements was £80,000 (2020: £30,000) based upon the loss before tax. The performance materiality for the parent company was £56,000 (2020: £21,000).

Component materiality for all entities within the group was set lower than our overall group materiality and ranged from £1,000 to £75,000 with a performance materiality set at 70% of overall materiality.

We agreed with the audit committee that we would report all audit differences identified during the course of our audit in excess of £13,750 at group level, as well as differences below that threshold that, in our view, warranted reporting on qualitative grounds.

Our approach to the audit

Our audit is risk based and is designed to focus our efforts on the areas at greatest risk of material misstatement, aspects subject to significant management judgement as well as greatest complexity, risk and size.

As part of designing our audit, we determined materiality and assessed the risk of material misstatement in the financial statements. In particular, we looked at areas involving significant accounting estimates and judgement by the directors and considered future events that are inherently uncertain. The recoverability of intangible assets and investments in subsidiary undertakings were assessed as areas which involved significant judgements by management. We also addressed the risk of management override of internal controls, including among other matters consideration of whether there was evidence of bias that represented a risk of material misstatement due to fraud.

The accounting records of the parent company and all subsidiary undertakings are centrally located and audited by us based upon group materiality or risk to the group. The key audit matters and how these were addressed are outlined below.

Key audit matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial statements of the current year and include the most significant assessed risks of material misstatement (whether or not due to fraud) we identified, including those which had the greatest effect on: the overall audit strategy, the allocation of resources in the audit; and directing the efforts of the engagement team. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

Other information

The other information comprises the information included in the annual report, other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the group and parent company financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of the audit:

· the information given in the strategic report and the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and

· the strategic report and the directors' report have been prepared in accordance with applicable legal requirements.

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the group and the parent company and their environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report.

We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:

· adequate accounting records have not been kept by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or

· the parent company financial statements are not in agreement with the accounting records and returns; or

· certain disclosures of directors' remuneration specified by law are not made; or

· we have not received all the information and explanations we require for our audit.

Responsibilities of directors

As explained more fully in the Statement of Directors' Responsibilities, the directors are responsible for the preparation of the group and parent company financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the group and parent company financial statements, the directors are responsible for assessing the group and the parent company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the group or the parent company or to cease operations, or have no realistic alternative but to do so.

Auditor's responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:

· We obtained an understanding of the group and parent company and the sector in which they operate to identify laws and regulations that could reasonably be expected to have a direct effect on the financial statements. We obtained our understanding in this regard through discussion with management, our expertise in the sector and through the application of cumulative audit knowledge.

· We determined the principal laws and regulations relevant to the group and parent company in this regard to be those arising from the Companies Act 2006, IFRS accounting standards, and the operating terms set out in the exploration licenses, as well as local laws and regulations.

· We designed our audit procedures to ensure the audit team considered whether there were any indications of non-compliance by the group and parent company with those laws and regulations. These procedures included, but were not limited to:

o enquiries of management; and

o review of minutes and other correspondence.

· We also identified the risks of material misstatement of the financial statements due to fraud at both the group and parent company level. We considered, in addition to the non-rebuttable presumption of a risk of fraud arising from management override of controls, whether key management judgements could include management bias was identified in relation to the carrying value of the exploration assets and we addressed this as outlined in the Key Audit Matters section.

· As in all of our audits, we addressed the risk of fraud arising from management override of controls by performing audit procedures which included, but were not limited to: the testing of journals; reviewing accounting estimates for evidence of bias; and evaluating the business rationale of any significant transactions that are unusual or outside the normal course of business.

· Compliance with laws and regulations at the subsidiary level was ensured through enquiry of management and review of ledgers and correspondence for any instances of non-compliance.

Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at: http://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.

Use of our report

This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone, other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed.

David Thompson (Senior Statutory Auditor)

For and on behalf of PKF Littlejohn LLP

Statutory Auditor

15 Westferry Circus

Canary Wharf

London

E14 4HD

Independent Auditor's Report to the Members of Altus Strategies plc in Respect of Canadian National Instrument 52-107

Opinion

We have audited the group financial statements of Altus Strategies plc and its subsidiaries (the "group") for the year ended 31 December 2021 which comprise the Group Statement of Comprehensive Income, the Group Statement of Financial Position, the Group Statement of Changes in Equity, the Group Statement of Cash Flows and notes to the financial statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and International Financial Reporting Standards (IFRSs) as issued by the International Accounting Standards Board ("IASB").

In our opinion:

• the group financial statements present fairly, in all material respects, the financial position of the group as at 31 December 2021 and 31 December 2020 and its financial performance and its cash flows for the years then ended; and

• the group financial statements have been properly prepared in accordance with IFRSs as issued by the IASB.

Basis for Opinion:

We conducted our audit in accordance with International Standards on Auditing (ISAs) as issued by the IAASB and applicable law.

Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the group in accordance with the International Ethics Standards Board for Accountants' Code of Ethics for Professional Accountants (IESBA Code) together with the ethical requirements that are relevant to our audit of the group financial statements in the UK, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the IESBA code. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Key audit matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial statements of the current year. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

We have determined the following key audit matters and set out our findings:

Other information

The other information comprises the information included in the annual report and the management discussion and analysis, other than the financial statements and our auditor's report thereon. The directors are responsible for the other information.

Our opinion on the financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

We have nothing to report in this regard.

Responsibilities of directors

As explained more fully in the directors' responsibilities statement, the directors are responsible for the preparation and fair presentation of the financial statements in accordance with IFRSs, and for such internal control as the directors determine are necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the directors are responsible for assessing the group's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the group or to cease operations, or have no realistic alternative but to do so.

Auditor's responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with International Standards on Auditing (ISAs) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

As part of an audit in accordance with ISAs, we exercise professional judgment and maintain professional scepticism throughout the audit. We also:

· Identify and assess the risks of material misstatement of the group's financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

· Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the group's internal control.

· Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the Directors.

· Conclude on the appropriateness of the Directors' use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the group's and the parent company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in the auditor's report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of the auditor's report. However, future events or conditions may cause the group to cease to continue as a going concern.

· Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

· Are required to report on consolidated financial statements, obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for the audit opinion.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the financial statements of the current year and are therefore the key audit matters. We describe these matters in our auditor's report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

The partner in charge of the audit resulting in this independent auditors' report is David Thompson.

David Thompson (Engagement Partner)

for and on behalf of PKF Littlejohn LLP

Statutory Auditor

15 Westferry Circus

Canary Wharf

London

E14 4HD

ALTUS STRATEGIES PLC

Group Statement of Comprehensive Income

For the Year Ended 31 December 2021

The notes on pages 87-119 form part of these financial statements.

ALTUS STRATEGIES PLC

Group Statement of Financial Position

As at 31 December 2021

Company Registration No. 10746796

The notes on pages 87-119 form part of these financial statements. The financial statements were approved by the Board of Directors and authorised for issue on 28 April 2022 and are signed on its behalf by:

Steven Poulton

Chief Executive Officer

ALTUS STRATEGIES PLC

Company Statement of Financial Position

As at 31 December 2021

Company Registration No. 10746796

As permitted by Section 408 of the Companies Act 2006, the Company has not presented its own statement of comprehensive income and related notes. The Company's loss for the year was £4,567,180 (2020: loss of £950,812).

The notes on pages 87-119 form part of these financial statements.

The financial statements were approved by the Board of Directors and authorised for issue on 28 April 2022 and are signed on its behalf by:

Steven Poulton

Chief Executive Officer

ALTUS STRATEGIES PLC

Group Statement of Changes in Equity

For the Year Ended 31 December 2021

The notes on pages 87-119 form part of these financial statements.

ALTUS STRATEGIES PLC

Company Statement of Changes in Equity

For the Year Ended 31 December 2021

The notes on pages 87-119 form part of these financial statements.

ALTUS STRATEGIES PLC

Group Statement of Cash Flows

Significant non-cash transactions

Significant non-cash transactions are detailed in note 35.

The notes on pages 87-119 form part of these financial statements.

ALTUS STRATEGIES PLC

Company Statement of Cash Flows

For the Year Ended 31 December 2021

Significant non- cash transactions

Significant non-cash transactions are detailed in note 35.

The notes on pages 87-119 form part of these financial statements.

ALTUS STRATEGIES PLC

Notes to the Financial Statements

For the Year Ended 31 December 2021

1 Accounting policies

Company information

Altus Strategies plc is a public company limited by shares and incorporated in England and Wales. The registered office is 14 Station Road, Didcot, Oxfordshire, OX11 7LL, United Kingdom. The Group consists of Altus Strategies plc and all of its subsidiaries, as listed in note 20.

Basis of preparation

These financial statements have been prepared in accordance with UK-adopted International Accounting Standards and IFRS interpretations committee (IFRS IC) interpretations issued by the IASB. The consolidated financial statements have also been prepared in accordance with those parts of the Companies Act 2006 applicable to companies reporting under IFRS, (except as otherwise stated).

The financial statements have been prepared on the historical cost basis, as modified by the valuation of financial assets at fair value through profit or loss. The principal accounting policies adopted are set out below.

The financial statements are presented in British Pounds Sterling (£), which is also the functional currency of the Company. Monetary amounts in these financial statements are rounded to the nearest whole pound.

As permitted by section 408 of the Companies Act 2006, the Company has not presented its own statement of comprehensive income and related notes. The Company's loss for the year was £4,567,180 (2020: loss of £950,812).

Basis of consolidation

The consolidated financial statements comprise the financial statements of Altus Strategies plc and its subsidiaries as at 31 December 2021. Subsidiaries are fully consolidated from the date on which control is transferred to the Group.

Control is achieved when the Group is exposed, or has rights, to variable returns from its involvement with the investee and has the ability to affect those returns through its power over the investee. Specifically, the Group controls an investee if, and only if, the Group has:

- power over the investee (i.e. existing rights that give it the current ability to direct the relevant activities of the investee)

- Exposure, or rights, to variable returns from its involvement with the investee

- The ability to use its power over the investee to affect its future

Generally, there is a presumption that a majority of the voting rights results in control. To support this presumption and when the Group has less than a majority of the voting rights or similar rights of an investee, the Group considers all relevant facts and circumstances in assessing whether it has the power over an investee, including:

- The contractual arrangements with the other vote holders of the investee

- Rights arising from other contractual arrangements

- The Group's voting rights and potential voting rights

The Group re-assesses whether or not it controls an investee if facts and circumstances indicate that there are changes to one or more of the three elements of control. Consolidation of a subsidiary begins when the Group obtains control over the subsidiary and ceases when the Group loses control of the subsidiary. Assets, liabilities, income and expenses of a subsidiary acquired or disposed of during the year are included in the consolidated financial statements from the date the Group gains control until the date the Group ceases to control the subsidiary.

"Joint ventures" as referred to in the financial statements refer to agreements with exploration partners and not joint ventures as defined within IFRS 11.

Profit or loss and each component of other comprehensive income are attributed to the equity holders of the parent company of the Group and to the non-controlling interests, even if this results in the non-controlling interests having a deficit balance.

Entities are recognised as joint operations if:

- Their legal form gives parties rights to the assets and obligations for the liabilities relating to the joint arrangement

- The contractual terms of the joint arrangement specify that parties have rights to the assets and obligations for the liabilities relating to the arrangement

- The arrangement has been designed by the parties so that its activities provide the parties with an output which represents rights to substantially all of the economic benefits of the assets held in the separate vehicle

Joint operations are accounted for on a proportional assets and liabilities basis.

Investments in associates are accounted for using the equity method, with initial measurement based on costs of acquisition including transaction costs. The carrying amount is adjusted to recognise the Group's share of the change in net assets after the date of acquisition. Distributions received from an associate reduce the carrying amount of the investment. The Company's share of post-acquisition profit or loss is recognised in the Statement of Comprehensive Income based on its economic interest in the associate.

All intra-group assets and liabilities, equity income, expense and cash flows relating to transactions between members of the Group are eliminated in full on consolidation.

Going concern

During the year, the Company raised a total £27.5 million (C$47.1 million) in two equity fundraisings. In March 2021, the Company raised £7.7 million (C$13.4 million) through a placement of 10,266,668 Ordinary Shares of the Company at a price of £0.75 (C$1.30) per share with existing and new institutional and private investors. La Mancha and certain directors and employees of the Group participated in the placement.

In December 2021, the Company raised £19.8 million (C$33.7 million) before expenses through a placement of 36,930,143 Ordinary Shares of the Company at a price of £0.535 (C$0.90) per share with new and existing institutional investors and private investors. La Mancha and certain directors and employees of the Group participated in the placement.

The Directors have assessed the cash resources available to the Company, including balances of cash and investments held in publicly traded companies at the reporting date. They have reviewed a detailed 24-month budget prepared by the Company, assessing the likelihood of receiving projected royalty and other income, debt coverage and the breakdown between committed and discretionary projected expenditure. Given the Company's previous statement of the low impact of Covid-19 on operations in the short-to-medium term, a renewed outbreak of Covid-19 has not been included in the analysis. Based on their assessment, the Directors anticipate that net income from the current portfolio of royalties is unlikely to be sufficient to cover exploration and other costs of the business over the next 12 months and that in that period the Company may have to raise additional funding. In making their assessment, the Directors acknowledged the existence of a number of material uncertainties including volatility in financial and commodity markets, and political and security risks. These and other risks faced by the Company are outlined in detail in the Strategic Report on pages 21 to 23.

The Company's loan liability to La Mancha, the balance of which was £18.3 million at 31 December 2021, is repayable by 30 June 2022. As at the date of this report, a re-financing of the loan has not been put in place. The Directors note that, were the Company unable to secure a re-financing of the loan, it could potentially impact the Company's ability to maintain its current business operations, and acknowledge that this constitutes a material uncertainty. However, the Directors also note that Altus has received a number of proposals to re-finance the loan before 30 June 2022, and they remain confident that the necessary funding will be secured.

Based on their assessment, the Directors have, at the time of approving the financial statements, a reasonable expectation that the Group will have adequate resources to continue in operational existence for the foreseeable future. Therefore, the Directors continue to adopt the going concern basis of accounting in preparing the financial statements.

Exceptional items

Exceptional items are disclosed separately in the financial statements where it is necessary to do so, to provide further understanding of the financial performance of the Group. They are material items of income or expense that have been shown separately due to the significance of their nature or amount. Listing and acquisition related costs are included as exceptional items in profit or loss.

Fair value measurement

IFRS 13 establishes a single source of guidance for all fair value measurements. IFRS 13 does not change when an entity is required to use fair value, but rather provides guidance on how to measure fair value under IFRS when fair value is required or permitted. The resulting calculations under IFRS 13 affected the principles that the Group uses to assess the fair value, but the assessment of fair value under IFRS 13 has not materially changed the fair values recognised or disclosed. IFRS 13 mainly impacts the disclosures of the Company. It requires specific disclosures about fair value measurements and disclosures of fair values, some of which replace existing disclosure requirements in other standards. IFRS 13 applies a three-level hierarchy, from level 1 for regularly traded assets with a readily ascertainable market value to level 3 for rarely traded assets which require a high degree of estimation to ascertain their value. Fair value is applied to the following elements of the Company's assets.

Foreign exchange

Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the date of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation are included in the Statement of Comprehensive Income for the period.

Other reserves

Other reserves consist of a non-distributable merger reserve from historic acquisitions and the foreign currency translation reserve.

2 Adoption of new and revised standards and changes in accounting policies

New and amended standards adopted by the Group and Company

The Group and Company have applied the following standards and amendments for the first time for its annual reporting period commencing 1 January 2021:

The Group and Company has assessed the adoption of these standards and amendments and there has been no material impact on the financial statements as a result of the adoption.

New and revised IFRSs in issue but not yet effective

The Group and Company have not applied the following new and revised Standards and Interpretations that have been issued but are not yet effective:

* subject to endorsement

The Group and Company are evaluating the impact of the new and amended standards above. The Directors believe that these new and amended standards are not expected to have a material impact on the Group and Company's results or shareholders' funds.

3 Critical accounting estimates and judgements

The Group makes estimates and assumptions concerning the future. The resulting accounting estimates will seldom equal the related actual results. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are as follows.

4 Revenue and costs recovered from JV partners

Costs recovered from JV partners and management fees relating to JV projects are recognised in the month in which they arise. Milestone payments, which relate to various stages of JV projects including on signature of an agreement, election by the JV partner to proceed to the next project stage, definition of a resource or completion of a feasibility study, are recognised once the Company's performance obligation is satisfied, in accordance with IFRS 15 Revenue from Contracts with Customers. Royalty income received by associate companies is included in the share of profit or loss on associate (see note 21).

5 Segmental analysis

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

6 Operating loss

7 Exploration and development costs

The Group's costs derived from its operations in countries in which it holds exploration licences are detailed below.

These figures include an allocation of UK costs including geologists' salaries, management time and UK support costs, based on the number of projects running in each country during the year. During the year, the Group was awarded four projects in Egypt and 10 projects in Morocco, and it relinquished one project in Mali (Pitiangoma Est).

8 Administrative expenses

Administrative expenses include the balances in the table below.