Firering Strat Regulatory News (FRG)

Firering Strategic Minerals plc / EPIC: FRG / Market: AIM / Sector: Mining

27 September 2023

 Firering Strategic Minerals plc

("Firering" or "the Company")

 Interim Results

For the Six Months Ended 30 June 2023

Firering Strategic Minerals plc, an exploration company focusing on critical minerals, is pleased to announce its interim results for the six months ended 30 June 2023.

Corporate and Operational Highlights

· Start of Phase II soil sampling programme at its Atex Lithium-Tantalum Project ("Atex") in conjunction with Joint Venture partner, Ricca Resources Limited ("Ricca") following its US$18.6 million investment in Atex.

· Increased stake in Atex to 90% following successful Phase I drilling campaign and the start of the soil sampling programme in January 2023. In addition, we hold 51% of the adjacent Alliance mining application.

· Successful completion of Phase II soil sampling programme

· Start of Phase II auger drilling programme in three target areas identified from Phase II soil sampling programme:

o  Detailed geological mapping and soil sampling provide evidence of an enlarged pegmatite field.

o  Initial 11,000m of Phase II auger drilling planned.

Post Period Highlights

· Option deed secured to acquire up to 28.33% of Limeco Resources Limited ("Limeco") owner of ex-Glencore Limestone Project in Zambia (announced on 17 August 2023):

o  Limeco is expected to be profitable and delivering cashflow within 12 - 24 months.

o  Strategy is to pay dividend to shareholders as soon as possible.

o  US$100 million spent historically on the lime plant by Glencore.

o  Estimated resource* of 73.7Mt @ 95.3% CaCO3 and an estimated limestone stockpile of 190,000 tonnes, which will be used to start production.

o  Commissioning of the crushing plant to produce aggregates and accelerate cashflow ahead of kiln modifications and plant commissioning.

· A total of nine target areas were identified at Atex, including six new pegmatite zones, and have been geologically mapped in detail.

· Completion of Part 1 of Phase II Auger drilling:

o  1,039 holes were drilled for a total of 6,015 metres with an average depth of hole of 5.79m.

· Completion of an oversubscribed placing raising £756,000 to support:

o  Further definition of identified pegmatite targets with c.5,000m auger drilling campaign (Part 2 of Phase II) at Atex;

o  The commencement of a 3,000 metre Reverse Circulation ("RC") drilling campaign to better define the pegmatites identified during the auger drilling in terms of mineralisation, size and orientation (see Figure 1 drilling plan below);

o  Complete the Laser Induced Breakdown Spectrometry ("LIBS") test work on the remaining c. 50% of the soil samples; and

o  Gradual modifications of the eight kilns at the lime plant in Zambia, with the first two kilns expected to be commissioned during Q1 2024.

Commenting on the results, Yuval Cohen, Chief Executive of Firering, said:

"Our strategy has always been to increase shareholder value through the continued exploration of our flagship asset, Atex. To this end, and with the support of our JV partner, Ricca Resources, we spent a significant amount of time in the field since the start of 2023. Positive results from our Phase II soil sampling programme identified multiple target areas for further exploration and were pivotal in our decision to increase our stake in Atex from 77% to 90% and our consequent Phase II auger drilling campaign. After the period, and supported by the positive results from Part 1 of the Phase II auger drilling campaign, we announced our intention to start a 3,000m RC drilling campaign at Atex, which we believe has the potential to become a significant lithium producer in Côte d'Ivoire.

"Post period, activity levels further increased and we are delighted to have agreed an option agreement with Limeco Resources, which owns a limestone project in Zambia. The project, previously owned by Glencore who invested US$100 million, has the potential to transform Firering into a cash generative business in a relatively short space of time.

To support this forward momentum, we raised £756,000 post period end in an oversubscribed placing, which will enable us to conduct further auger and RC drilling work at Atex, with the objective of increasing our understanding of the existing and newly identified pegmatites in terms of mineralisation, size and orientation, and support the kiln modifications at the lime plant in Zambia."

Figure 1: Plan view showing 2022 DD holes in black and planned 2023 RC holes in blue.

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION AS STIPULATED UNDER THE UK VERSION OF THE MARKET ABUSE REGULATION NO 596/2014 WHICH IS PART OF ENGLISH LAW BY VIRTUE OF THE EUROPEAN (WITHDRAWAL) ACT 2018, AS AMENDED. ON PUBLICATION OF THIS ANNOUNCEMENT VIA A REGULATORY INFORMATION SERVICE, THIS INFORMATION IS CONSIDERED TO BE IN THE PUBLIC DOMAIN.

*** ENDS ***

For further information and updates on Firering's exploration programme, visit www.fireringplc.com or contact the following:

 Chairman's Statement

I am pleased to report a busy half-year with significant operational achievements during the six months to 30 June 2023.

Operational Update

The Company's focus at the start of 2023 was to continue to accelerate exploration at its flagship lithium and tantalum project - Atex, following the success of the first phase of diamond drilling campaign in 2022. To this end, in January 2023, Firering announced the start of a Phase II soil sampling programme. The programme was undertaken in conjunction with Ricca Resources Limited ("Ricca") following its US$18.6 million investment to advance Atex to a Definitive Feasibility Study ("DFS") level.  A total of 14,116 soil samples were taken, prepared, and sent to Ghana for portable x-ray fluorescence spectrometry ("pXRF") and Laser Induced Breakdown Spectrometry ("LIBS") analysis. Several new pegmatite related anomalies were identified, which provided vital information for the next stage of the Company's auger drilling campaign.

Plans to start the next auger drilling programme were announced on 23 June 2023.  Nine target areas were identified during the Company's Phase II soil sampling programme with several lithium in soil anomalies occurring adjacent and along similar orientations, to Spodumene Hill where previous drilling returned significant intersections, including an oblique intersection with an apparent width of 64m at 1.24% Li2O and 25m at 1.39% Li2O (refer the Company's notification of 15 November 2022 and 15 December 2022).

Phase II of the Atex soil sampling programme commenced on 9 January 2023 and was completed on 11 May 2023. Post the reporting period, on 11 July 2023, the Company announced that its Phase II Auger Drilling campaign had started successfully in late June. The campaign was undertaken in conjunction with Ricca and a total of 1039 holes were drilled as of 8 July 2023 for a total of 6,015m of drilling, resulting in an average hole depth of 5.79m. Nine priority targets were identified as a result of a very successful soil sampling programme, which included six new pegmatite zones that were the focus of Part 1 of the Phase II auger drilling campaign (announced on 20 September 2023).

In conjunction with Ricca, the Company is planning to start its first Reverse Circulation ("RC") drilling campaign at Atex in Q4 2023. A total of c.3,000m of drilling is planned to further test the pegmatite zones for mineralisation, orientation and dip.

In August 2023, the Company announced an option agreement for Firering to acquire 28.33% in Glencore's previous limestone project in Zambia, fromLimeco Resources Limited ("Limeco"), the current owner of the project, for US5.1 million. Limeco has an estimate resource* of 73.7Mt @ 95.3% CaCO3 and is expected to be profitable and delivering cashflow within 12-24 months.

It is estimated that Glencore invested approximately US$100 million in Limeco to establish the limestone quarry and construct the current lime plant, which would be used to produce quicklime for Mopane Copper Mine in Zambia. Limestone production from the quarry commenced in March 2016 and ceased in January 2017 following the sale of Mopane Copper Mine to ZCCM Investment Holdings plc.

On 30 August 2023, the Company announced commissioning of the crushing plant at Limeco, which. The crushing plant has been adapted to produce aggregate from the estimated 250,000 tonnes of waste rock material on site, which will enhance Limeco's cashflow during the upgrade and modifications of the kilns. Firering's team is assisting the local technical team with the gradual modifications of the eight kilns with the first two kilns expected to be commissioned during Q4 2023. We are also encouraged by the ongoing offtake discussions that Limeco has entered into with major copper producers that use quicklime in their copper flotation process.

Financial

The Company did not generate revenue during the period. Instead, it focussed on exploration and developing assets that the Board believes will generate revenue for the Company in the future.

For the six-month period ending 30 June 2023, the Company reports a pre-tax loss of €0.6m (six months ended 30 June 2022: pre-tax loss of €0.5m).

The Company's net cash balance as of 30 June 2023 was €0.3m. The Company successfully raised £756,000 (gross) through an oversubscribed placing of 11,630,769 new Ordinary Shares to certain investors at a price of 6.5 pence per share as notified on 21 September 2023.

Outlook

It is an exciting time for Firering as we continue to advance the Atex project in Côte d'Ivoire and evaluate the possibility of becoming a revenue generating Company through our option in Limeco. Following the oversubscribed placing announced on 21 September 2023, we have sufficient funds to continue with our exploration activities at Atex, which we see as paramount to our long-term value proposition, alongside the management support we can offer to Limeco.

We look forward to the next six months, which we believe will be highly value accretive for our Company.

On behalf of the entire Board, I would like to take this opportunity to thank our existing shareholders for their continued support and welcome our new shareholders.

Youval Rasin

Non-Executive Chairman

26 September 2023

\* The non-JORC compliant resource is based on all available drilling data as at August 2017. The Mineral Resources estimates are at this stage reported as an in situ Mineral Resources estimate only, as further work is required in order to be able to report the Mineral Resources estimates in accordance with the guiding principles and minimum standards set out in the 2012 Edition of the "Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves" (the JORC Code) and the Company's internal estimates, which are also not JORC compliant, are still subject to verification, validation, and external review; accordingly, such numbers are provided for guidance only. There can be no guarantee the final JORC-compliant resource estimate will reconcile with these early-stage calculations.

 The Company intends to commission a JORC compliant report when operations have been fully commissioned.

The accompanying notes form an integral part of the interim consolidated financial statements.

The accompanying notes form an integral part of the interim consolidated financial statements.

The accompanying notes form an integral part of the interim consolidated financial statements.

The accompanying notes form an integral part of the interim consolidated financial statements.

The accompanying notes form an integral part of the interim consolidated financial statements.

The accompanying notes form an integral part of the interim consolidated financial statements.

The accompanying notes form an integral part of the interim consolidated financial statements.

NOTE 1:- GENERAL INFORMATION

a. Firering Strategic Minerals PLC (the "Company") is a holding company for a group of exploration and development companies set up to focus on developing assets towards the ethical production of critical metals. The Company was incorporated on 8 May 2019 in Cyprus. The address of its registered office is Ioanni Stylianou 6, 2nd Floor, Office 202, 2003, Nicosia, Cyprus.

In November 2021 the Company completed its Initial Public Offering and admission to trading on the AIM, a market operated by the London Stock Exchange.

The Company owns 75% of the issued share capital of Bri Coltan SARL ("Bri Coltan") a company incorporated in Cote d'Ivoire. The principal activity of the subsidiary is the exploration and development of mineral projects (in particular, columbite- tantalite).

As more fully described in Notes 1, 6 and 19 to the 2022 annual consolidated financial statements, the Company has an investment in a joint venture, Marvella SA ("Marvella"), which was originally established as an SPV. The Company is in the administrative process of implementing transfers to Marvella of its investments in the following entities:

(i) 90% of the issued share capital of Atex Mining Resources SARL ("Atex") a company incorporated in Cote d'Ivoire. The principal activity of Atex is the exploration and development of mineral projects (in particular, lithium and columbite-tantalite).

(ii) 51% of the issued share capital of Alliance Minerals Corporation SARL ("Alliance"), a company incorporated in Cote d'Ivoire. Alliance holds an exploration license request at an area bordering Atex.

In November 2022 the Company signed an earn-in agreement with Ricca Resources Pty Limited ("Ricca"), an Australian diversified minerals company to advance the Atex Lithium-Tantalum Project and the adjacent Alliance exploration licence (once granted). According to the agreement, Ricca will have the exclusive right to undertake and fund at Ricca's sole cost the exploration of the Atex Project and adjacent Alliance licence, which exploration is to be undertaken through Marvella.

The Company holds 100% of the equity interest of Marvella as of the date of the financial statements and will continue to hold the majority of the equity interest until the completion of stage 4 of the earn-in period. However, according to the shareholders' agreement signed with Ricca, the Company and Ricca have joint control of Marvella. Accordingly, the investment in Marvella is considered a joint venture which is accounted for using the equity method.

b. Going concern:

The Board of Directors and Group management have assessed the ability of the Group to continue as a going concern. In respect of its mineral projects, funding has been obtained as follows:

Atex and Alliance

As described in Note 1a. above, in 2022 the Company signed an earn-in agreement with Ricca which has agreed to fund at its sole cost the two exploration projects of Marvella for a period that may extend to 4-5 years from the reporting date.

Subsequent to 30 June 2023, the Company was informed that Ricca is evaluating various alternatives to raise additional funds in order to continue its funding of Marvella's mining activities.

Bri Colton

As described in Note 7 to the annual consolidated financial statements, in 2022 the Company has been provided with a long-term credit facility of up to € 7.16 million which is intended be used to develop this project, with the objective of obtaining further funding.

The Group's mining operations are at an early stage of development and the continuing success of the Group will depend on the Group's ability to manage its mineral projects. Presently, the Group has no projects producing positive cash flow and the Group is likely to remain cash flow negative in the near future. The Group's ultimate success will depend on its ability to generate positive cash flow from active mining operations in the future and its ability to secure external funding for its development requirements. However, there is no assurance that the Group will achieve profitability or positive cash flow from its operating activities.

As more fully described in Note 5, in September 2023 the Company completed a Placing of Ordinary shares with total gross cash proceeds of £756,000 (c. €870,000).

Based on a review of the Group's budget and forecast cash flows including the proceeds of the Placing described above, there is a reasonable expectation that the Group will have adequate resources to continue in operational existence and meet its obligations as they become due for at least a period of twelve months from the date of approval of the financial statements. Thus, the going concern basis of accounting has continued to be applied in preparing these financial statements.

c. These financial statements have been prepared in a condensed format as of 30 June 2023 and for the six months then ended ("interim consolidated financial statements"). These financial statements should be read in conjunction with the Company's annual financial statements as of 31 December 2022 and for the year then ended and accompanying notes ("annual consolidated financial statements").

NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES

Basis of preparation of the interim consolidated financial statements:

The interim consolidated financial statements have been prepared in accordance with IAS 34, "Interim Financial Reporting".

The accounting policies adopted in the preparation of the interim consolidated financial statements are consistent with those followed in the preparation of the annual consolidated financial statements, except as described in Note 3 below.

NOTE 3:- INITIAL APPLICATION OF AMENDMENTS TO FINANCIAL REPORTING STANDARDS

1. Amendment to IAS 8, "Accounting Policies, Changes to Accounting Estimates and Errors":

In February 2021, the IASB issued an amendment to IAS 8, "Accounting Policies, Changes to Accounting Estimates and Errors" ("the Amendment"), in which it introduces a new definition of "accounting estimates".

Accounting estimates are defined as "monetary amounts in financial statements that are subject to measurement uncertainty". The Amendment clarifies the distinction between changes in accounting estimates and changes in accounting policies and the correction of errors.

The Amendment is to be applied prospectively for annual reporting periods beginning on or after January 1, 2023 and is applicable to changes in accounting policies and changes in accounting estimates that occur on or after the start of that period.

The application of the Amendment did not have a material impact on the Company's interim financial statements.

NOTE 3:- INITIAL APPLICATION OF AMENDMENTS TO FINANCIAL REPORTING STANDARDS (Cont.)

2. Amendment to IAS 12, "Income Taxes":

In May 2021, the IASB issued an amendment to IAS 12, "Income Taxes" ("IAS 12"), which narrows the scope of the initial recognition exception under IAS 12.15 and IAS 12.24 ("the Amendment").

According to the recognition guidelines of deferred tax assets and liabilities, IAS 12 excludes recognition of deferred tax assets and liabilities in respect of certain temporary differences arising from the initial recognition of certain transactions. This exception is referred to as the "initial recognition exception". The Amendment narrows the scope of the initial recognition exception and clarifies that it does not apply to the recognition of deferred tax assets and liabilities arising from transactions that are not a business combination and that give rise to equal taxable and deductible temporary differences, even if they meet the other criteria of the initial recognition exception.

The Amendment is effective for annual reporting periods beginning on or after January 1, 2023. In relation to leases and decommissioning obligations, the Amendment is applied commencing from the earliest reporting period presented in the financial statements in which the Amendment is initially applied. The cumulative effect of the initial application of the Amendment is recognized as an adjustment to the opening balance of retained earnings (or another component of equity, as appropriate) at that date.

The application of the Amendment did not have a material impact on the Company's interim financial statements.

3. Amendment to IAS 1 - Disclosure of Accounting Policies:

In February 2021, the IASB issued an amendment to IAS 1, "Presentation of Financial Statements" ("the Amendment"), which replaces the requirement to disclose 'significant' accounting policies with a requirement to disclose 'material' accounting policies. One of the main reasons for the Amendment is the absence of a definition of the term 'significant' in IFRS whereas the term 'material' is defined in several standards and particularly in IAS 1.

The Amendment is effective for annual periods beginning on or after January 1, 2023.

The above Amendment did not have an effect on the Company's interim consolidated financial statements. However, the Company is evaluating whether the Amendment will affect the disclosures of accounting policies in the Company's annual consolidated financial statements.

NOTE 4: - INVESTMENT IN JOINT VENTURE (MARVELLA)

Summarized financial data of the joint venture.

(1) Comprised of:

Capital reserve from transaction with non-controlling interest (*) 243

Accumulated deficit 20

263

(*) In March 2023 Marvella exercised the remaining existing option originally between Firering and Atex's shareholder and purchased an additional 13% of the issued shares in Atex and reached a total holding of 90% in Atex for a total consideration of €259 thousand. According to the agreement with Ricca Resources, Ricca paid €200 thousand and the balance of €59 thousand was funded by the Company. Marvella recorded the difference between the total consideration and the carrying amount of the non-controlling interest in the amount of €243 thousand as a capital reserve in equity.

(2) Investment is net of Company's share of loss and capital reserve in joint venture of €263 thousand.

For the period ending 30 June 2023, Ricca funded exploration expenditures of the joint venture in the amount of €843 thousand, of which €253 thousand was received in 2022.

NOTE 5:- SUBSEQUENT EVENT

On 21 September 2023, the Company announced that it had completed a Placing of 11,630,769 new Ordinary shares to certain investors at a price of 6.5 pence per shares for total gross proceeds of £756,000 (€870 thousand). Certain directors and their related parties have confirmed their intention to subscribe for approximately 1,076,922 Ordinary shares at the Placing price by funding an additional £70,000 (€81,000). It is expected that they will participate in the intended subscription shortly after the publication of the Company's interim results for the six months ended 30 June 2023.

In connection with the Placing, the Company has issued to the broker 581,538 warrants to purchase Ordinary shares at an exercise price of 6.5 pence per share. The warrants may be exercised at any time during a period ending three years from the date of the Admission to trading of the above Ordinary shares.

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