Ferro-Alloy Resources Limited
Annual Report
for the year ended
31 December 2025
Ferro-Alloy Resources Limited Annual Report 2025
Contents
REVIEW OF THE YEAR
2 Feasibility Study
7 Operational Review
9 Financial Review
11 Sustainability Review
15 Climate Change Disclosures
19 Principal Risks and Uncertainties
CORPORATE GOVERNANCE
21 Governance Statement
23 Board of Directors
25 Senior Management Team
26 Directors’ Report
29 Directors’ Responsibility Statement
FINANCIAL STATEMENTS
30 Independent Auditor’s Report
36 ConsolidatedStatementofProfitorLossand
Other Comprehensive Income
37 Consolidated Statement of Financial Position
38 Consolidated Statement of Changes in Equity
39 Consolidated Statement of Cash Flows
40 Notes to the Consolidated Financial Statements
67 Company Information
Ferro-Alloy Resources Limited
Annual Report 2025
Ferro-Alloy Resources Limited is developing the giant Balasausqandiq vanadium deposit in the
Kyzylordinskaya oblast of southern Kazakhstan. Being sedimentary in nature, unlike most other primary
vanadium deposits in the world, Balasausqandiq ore does not require pre-concentration or roasting of the
ore, giving far lower capital and operating costs. With carbon as a valuable by-product, Balasausqandiq is
expected to have the lowest vanadium cash production costs in the world.
Planned output for Phase 1 is 8,500 tonnes of vanadium pentoxide, with plans to increase up to four times
more in a second phase.
“The development of Balasausqandiq has the potential to make a significant impact on the world of
vanadium. We intend on meeting the rapidly expanding demand from battery storage as well as for the
steel industry faster, at lower capital costs per annual tonne, and at a lower cash production cost than
other existing or planned vanadium producers.”
Nicholas Bridgen, Chief Executive Officer
Ferro-Alloy Resources Limited Annual Report 2025 1
“A low-cost vanadium producer
emerging in Kazakhstan...“
Ferro-Alloy Resources Limited Annual Report 20252
Feasibility Study
On 13 October 2025, the Company announced the results of its feasibility study on Phase 1 of the Balasausqandiq vanadium
deposit (the “Project“) in Southern Kazakhstan (the “Feasibility Study“) that identified the strategic nature of the Project and its
potential to become one of the largest and lowest cost vanadium producers globally.
The Company subsequently announced on 4 November 2025 that the Company had received an indicative cost estimate from
China National Chemical Engineering Sixth Construction Co., Ltd (“CC6“) for the engineering, procurement and construction
(“EPC“) for the Project (excluding the relatively minor costs of the equipment relating to uranium and molybdenum sorption) of
US$261m.
Taking into account the CC6 EPC cost estimate and the results of the Feasibility Study, the compelling economics of the Project
(Phase 1 only) are as follows:
Capital expenditure (including working capital, strategic spares, owner's costs, insurance etc.) US$313.2m
Contingency US$42.4m
Pre-production income, less costs US$(43.7)m
Funding required to get into production US$311.9m
Net Present Value (after tax, discount rate of 8%) US$931.6m
Project Internal Rate of Return 31%
Cash cost of production (V
2
O
5
equivalent basis) US$4.35/lb
Cash cost of production net of by-products US$0.36/lb
Annual production of V
2
O
5
(tonnes) 8,500
Annual production of carbon black substitute (tonnes) 247,000
Mine life (years) 20
Further phases of development after this are likely, based on six further ore-bodies currently identified.
Background
Most of the world's vanadium is produced from vanadiferous titano-magnetite, a form of iron ore, using a process which
requires pre-concentration and high temperature roasting. However, the Balasausqandiq ore-body benefits from being a black
shale, which does not require concentration or roasting, resulting in a simpler flow sheet, with lower production costs and
significantly reduced environmental emissions.
The Group previously operated a large scale 15,000 tonnes per annum pilot plant that enabled the process to be optimised.
Around 20 tonnes of ammonium metavanadate (“AMV”) (a product which only requires a final heating stage to convert to
vanadium pentoxide (“V
2
O
5
”)) was produced and sold commercially. With certain modifications, the pilot plant operates today
as a research and development (“R&D“) centre for the Group's carbon black substitute (“CBS”) products as well as for treating
purchased concentrates.
Independent Feasibility Study results
In 2021, SRK Consulting (Kazakhstan) Limited (“SRK“) in conjunction with Tetra Tech Limited (“Tetra Tech“), were commissioned
to produce a feasibility study to independently verify the Group's processes. The Group also commissioned SGS Canada Inc
(“SGS“), an international independent laboratory testing organisation, to carry out the detailed test work under the supervision
of Tetra Tech.
REVIEW OF THE YEAR CORPORATE GOVERNANCE FINANCIAL STATEMENTS
Ferro-Alloy Resources Limited Annual Report 2025 3
Value enhancement opportunities
During completion of the Feasibility Study, the Group
identified areas for optimisation and value enhancement
beyond those included in the final Feasibility Study. It is
expected that further investigation during the front-end
engineering and design (“FEED”) stage of the Project could
lead to significant further improvement in Project economics.
The following are the areas which the Company believes
have potential for optimisation which could reduce capital
and operating costs, increase production, and significantly
improve the Project net present value and internal rate of
return.
Reagent consumption and metallurgical
recovery
The Feasibility Study has incorporated the higher level of
reagent consumption that was indicated by the laboratory-
scale test work carried out by SGS, achieving a metallurgical
recovery of 86.2%. Significantly lower reagent consumptions
were used in the much larger scale historical pilot test work
programme, also achieving a higher metallurgical recovery.
The Group's technical team believe that lower reagent
consumption and higher recovery can be achieved in actual
operations, and this will be tested further.
Carbon recovery
Carbon concentrator recovery was tested by SGS but
the potential to enhance recoveries by recirculating the
concentrator tailings is still to be confirmed. Although
a conservative estimate of recovery is included in the
Feasibility Study, there are indications that a higher recovery
might be achievable. This would be expected to increase
the scale of CBS production, expanding the Company's
by-product value, and further reducing the Project's already
industry leading forecast net cash operating costs.
CBS dry milling
The Feasibility Study design for the milling of the CBS
product is premised on wet milling but the Group has
installed and tested a 400 kg per hour dry milling test plant
and achieved excellent results, albeit testing with milled
ore rather than concentrate. The use of dry milling greatly
simplifies the operation as filtration and drying of finely
milled powders is avoided. The Company believes that it
is likely that this part of the operation will be changed to a
dry milling process during the FEED stage of development,
delivering significant capital cost savings and further
enhancement of Project economics.
New CBS product
The Group has developed a new CBS product (see Company
announcement dated 27 June 2025) which can be made
from the high-carbon waste to be mined to access the
vanadium ores. This is in addition to the original CBS product
which is made by concentrating the carbon in the tailings
from the vanadium treatment plant. The new material has
not been included in the Feasibility Study. No scheduling
of production has yet been carried out but the amounts
of suitably high carbon material within the waste already
scheduled to be mined would indicate that an average of
around 225,000 tonnes of this new type of material might
be produced per year in addition to the 247,000 tonnes of
the original CBS that have been included in the Feasibility
Study. This material is available at no additional mining cost,
requiring limited capital expenditure on crushing and dry
milling. Discussions with potential customers are continuing
after successful laboratory testing. Further bulk testing of
this product is planned.
Value engineering
The Group's operational team has gained considerable
experience in procurement and fabrication through the
construction and development of the Group's existing
operations. The Company believes that there is the
opportunity to negotiate more favourable terms with
suppliers than those included in the Feasibility Study,
particularly regarding local and regional services and
equipment.
Ferro-Alloy Resources Limited Annual Report 20254
Mineral Resources and Ore Reserves
Resource
Class
Weathering
grade
Mass
(Mt) Grade (%) Material Content (tonnes)
V
2
O
5
Mo U C V
2
O
5
Mo U C
Measured - - - - - - - - - -
Indicated
Resource
Oxide 1.56 0.67 0.0139 0.0047 7.16 10,560 216 73 112,151
Transitional 1.25 0.66 0.0138 0.0045 7.17 8,260 172 56 89,869
Fresh -
sulphide
30.08 0.61 0.0150 0.0052 8.83 184,814 4,523 1,554 2,655,454
Total 32.89 0.62 0.0149 0.0051 8.69 203,634 4,911 1,683 2,857,473
Inferred - - - - - - - - - -
* Differences may occur in totals due to rounding.
Ore Class
Weathering
grade
Mass
(Mt) Grade (%) Material Content (tonnes)
V
2
O
5
Mo U C V
2
O
5
Mo U C
Probable
Reserve
All Material
Types
30.93 0.59 0.0143 0.0049 8.35 181,781 4,421 1,520 2,528,596
* The Balasausqandiq Ore Reserve Statement has its effective date as 30 September 2025, and is reported at a cut-off grade of 0.29% V2O5 Eq within an
optimal pit shell.
The Reporting Standard adopted for reporting of the Mineral
Resource and Ore Reserve Statements for the Project is
that defined by the terms and definitions given in “The 2012
Australasian Code for Reporting of Exploration Results,
Mineral Resources and Ore Reserves as published by the
Joint Ore Reserves Committee of the Australasian Institute of
Mining and Metallurgy, Australian Institute of Geoscientists
and Minerals Council of Australia“ (the “JORC Code (2012)“).
The JORC Code (2012) has been aligned with the Committee
for Mineral Reserves International Reporting Standards
(“CRIRSCO“) reporting template.
Mining
The Balasausqandiq mine will comprise a conventional drill
and blast, truck and shovel open pit operation, with waste
rock dumps located externally to the pit. The open pit
operation is planned to deliver 30.9 million tonnes (“Mt“) of
ore from 167.7 Mt total material mined, over a mine life of
20 years, with an average strip ratio of 4.4 tonnes of waste
per tonne of ore, with average grades of 0.59% V
2
O
5
, 8.35%
carbon, 0.005% uranium and 0.014% molybdenum.
Metallurgy
The Feasibility Study test work programme was designed
to independently verify the processes developed by the
Group for the efficient extraction of vanadium, molybdenum,
uranium and carbon products from the Balasausqandiq
black shale ore. The bulk and variability testing programme
at SGS used ore samples representative of the
Balasausqandiq mineralisation selected by Group geologists
and Tetra Tech. The tests completed on crushing, grinding,
leaching, impurity removal, product purification, carbon, solid
liquid separation and tailings management provided SRK and
Tetra Tech validated measurements to support performance
parameters, equipment selection and financial metrics.
Additional process improvement opportunities have been
identified during the Feasibility Study that will be considered
and incorporated during the following detailed design phase.
Carbon
The ore at Balasausqandiq contains around 8.35% carbon
which flows through to the tailings from the vanadium
extraction process. Test work carried out by SGS indicated
that the carbon level in these tailings can be concentrated
to 40% carbon with a recovery of 72%. Further test work
carried out by specialist rubber testing consultants indicated
that this material can be used as a reinforcing filler in partial
replacement for carbon black in making rubber. When
used in tyre sidewalls (a major use of carbon black) the
tyre performance was not materially different from tyres
with the reinforcing filler made wholly from carbon black.
TheFeasibility Study indicates that annual production of this
CBS product, following commissioning of the main plant,
Feasibility Study continued
REVIEW OF THE YEAR CORPORATE GOVERNANCE FINANCIAL STATEMENTS
Ferro-Alloy Resources Limited Annual Report 2025 5
will be around 247,000 tonnes. The Feasibility Study did not
include the newly developed second CBS product discussed
as a potential value enhancement above, which provides
very significant upside potential.
Vanadium for electrolyte for the
vanadium redox flow battery market
At the existing process plant, the Company has successfully
tested the production of high purity V
2
O
5
, as well as
vanadium trioxide suitable for making battery electrolyte,
and the electrolyte itself. The Feasibility Study envisages
the sale of V
2
O
5
flake, suitable for the steel industry, but it
is recognised that as the market for vanadium redox flow
batteries (“VRFBs”) develops, an increasing proportion of
the market will include these other vanadium oxides, or the
electrolyte itself. The necessary small changes to the plant
can be made either at a later date or during the engineering
phase prior to construction.
Currently, high purity vanadium is used for battery
electrolyte, chemical, aerospace and military purposes
and sells for a premium price. This potential benefit has
not been incorporated into the financial model for the
FeasibilityStudy.
Markets
Vanadium
The Company commissioned CRU International Limited
(“CRU“) to assess the available markets and pricing for
standard grade V
2
O
5
and to take account of the geography
and logistics costs.
CRU advised that a deficit of supply is likely to emerge from
2029 onwards, with use of V
2
O
5
in long term energy storage
batteries rising rapidly to account for some 76% of annual
V
2
O
5
demand by 2040. Indeed, CRU foresee a deficit of some
171,000 tonnes of V
2
O
5
per annum arising by 2035, which is
larger than the entire market in 2024.
Subsequent to the Feasibility Study, CRU have forecast
that the market deficit might arise earlier than previously
expected, with a deficit arising as early as the end of
2026. This updated forecast has not been reflected in the
Feasibility Study results.
Bearing in mind logistics for different locations of customers,
CRU forecast net-back prices at factory gate for the Company
of:
Year
Net-back
Per lb V
2
O
5
US$ 2025 real
2028 8.02
2029 8.67
2030 9.05
2031 9.43
2032 9.81
2033 10.19
2034 10.60
2035 10.60
2036 10.60
2037 onwards 10.59
CBS
Global market consultants, Smithers Information Limited
(“Smithers“) advised that, based on the results of technical
tests on rubber made from CBS, and by comparison with
other reinforcing fillers on the market, the material can be
sold for US$500 per tonne in the tyre market and up to
US$600 per tonne in the non-tyre market. The Company
has utilised a price assumption of US$500 per tonne in the
Feasibility Study. Achievement of the higher US$600 per
tonne pricing would further increase the Project's forecast
EBITDA by US$24.7m per annum, solely from the Company's
247,000 tonnes of initial CBS production. Further value may
be derived from the saving to customers of emissions tariffs
owing to the much lower CO
2
embedded emissions of CBS
compared with carbon black.
Environment
Vanadium
When vanadium is used as an alloy, the additional strength
and performance of the resulting steel significantly reduces the
quantities of steel required. Steel production accounts, very
broadly, for around 10% of world CO
2
emissions, so increasing
use of high quality vanadium containing steels can play a
significant role in minimising this source of global warming.
VRFBs are the leading technology for large scale, long
duration, energy storage batteries which are increasingly
needed as the use of intermittent renewable energy sources
makes up an increasing proportion of energy generation. The
increase in demand for vanadium for this purpose is expected
by CRU to lead to a shortage of vanadium, starting in 2029.
Balasausqandiq is, therefore, essential to the world's move to
renewable energy and the mitigation of global warming.
Ferro-Alloy Resources Limited Annual Report 20256
CBS
Production of carbon black from current industrial
manufacturers is a highly polluting process, involving the
combustion of heavy hydrocarbons in an oxygen depleted
atmosphere, resulting in CO
2
emissions of between 2 to
3 tonnes per tonne of product, as well as other harmful
polluting off-gases. However, the Company's CBS products
would be produced from the wastes from mining and
processing of vanadium ores, resulting in no additional
emissions being generated. Subsequent milling, drying,
bagging and transport are expected to amount to less than
0.25 tonnes of CO
2
emissions per tonne of CBS product.
The net benefit of the Company's CBS product versus
conventional carbon black products, would thus provide a
forecast reduction in emissions of approximately 90%.
Compliance with global standards
The Company's environmental consultants have undertaken
numerous baseline studies and other reviews taking into
account the requirements of the various environmental,
social and governance (“ESG”) based standards including the
Equator Principles and the IFC's Performance Standards. No
issues have been identified that would prevent the Project
from progressing.
Feasibility Study service providers
The Feasibility Study service providers were SRK holding
overall responsibility for the Feasibility Study, Tetra Tech for
metallurgy and process plant design, SGS for laboratory test
work, CRU providing V
2
O
5
price forecasting and vanadium
market insight and Smithers who carried out the technical
and marketing reports on the CBS.
Future phases
Phase 1 is based only on OB1, the first ore-body out of seven
within the Group's licence area for which there is geological
evidence. Of the remaining six ore-bodies, OB2,3&4 have
been explored and full assay and mineral resource estimates
will be published in due course. However, preliminary
analysis, based on semi-quantitative x-ray fluorescence
of OB2,3&4, indicates that there will be ample resource
to consider an additional Phase 2 operation at a scale of
around three times larger than Phase 1 with a similarly long
mine life. No study has yet been made but the ore is known
to be very similar and mining and metallurgical processes
are also expected to be similar allowing further upside.
The remaining ore-bodies have not been explored but will
remain for further future development.
Feasibility Study continued
REVIEW OF THE YEAR CORPORATE GOVERNANCE FINANCIAL STATEMENTS
Ferro-Alloy Resources Limited Annual Report 2025 7
Operational Review
The existing process plant continues to operate primarily an R&D centre but also recycles concentrates to recover vanadium,
molybdenum and nickel on an opportunistic basis.
Production
During the year, production of V
2
O
5
(mainly as AMV) and molybdenum (in ferro-molybdenum) amounted to 316.8 tonnes
(2024: 300.9 tonnes) and 47.7 tonnes (2024: 34.9 tonnes), respectively.
Quarter
Production of
Vanadium
pentoxide
(tonnes)
Growth vs
last year
Production of
Molybdenum
(tonnes)
Growth vs
last year
Q1 76.5 -6.3% 17.0 +139.4%
Q2 74.5 -15.0% 10.8 +56.5%
Q3 100.0 +91.2& 13.9 +95.8%
Q4 65.8 -17.1% 5.9 -57.2%
2025 total 316.8 +5.2% 47.6 +36.4%
During the year, the plant also produced a concentrate from the nickel-rich residues produced from the vanadium and
molybdenum extraction process. Whilst some sales were made, most of this material has been stockpiled awaiting treatment
on site. An internal concept study has been carried out for the installation of an electric arc furnace and associated equipment
to treat this material to produce ferro-nickel.
Product prices (mid-market, as published) for V
2
O
5
and ferro-molybdenum have broadly remained stable during the year, as
shown in the table below.
Start of 2025
Average
for the year End of 2025
Current
(24 April 2026)
Vanadium pentoxide (US$/lb) 5.37 5.20 5.8 6.11
Ferro-molybdenum (US$/kg of Mo) 49.8 51.9 52.4 65.1
Research and Development
Vanadium electrolyte
During 2025, the Group successfully developed and tested the technology for the production of vanadium mixed oxides for
the purpose of the production of vanadium electrolyte for battery energy storage. The technological process has been defined
and sample products have been made. Following this project, the Group is planning to participate in a new Kazakhstan Science
Fund project which is aiming to produce a 25 kW VRFB by supplying high purity V
2
O
5
or vanadium trioxide for the purpose of
producing the vanadium electrolyte. Although the Feasibility Study envisages the production of V
2
O
5
flake, suitable for use in
the steel industry, this technology is now ready to be incorporated into the development plan for the Balasausqandiq project if
offtake for electrolyte purposes is secured.
CBS
The Group is continuing to develop the new form of CBS (low-carbon concentrate) noted above. The results of laboratory
testing, in conjunction with a large potential customer, have shown good results, demonstrating already that this CBS can
be successfully partially substituted in a standard rubber tyre sidewall mix. The Group has prepared five tonnes of this CBS
concentrate for industrial testing by the customer which is now underway. In cooperation with this customer, the Group has
commissioned further research aimed at increasing the potential substitution levels even further.
Ferro-Alloy Resources Limited Annual Report 20258
Ferro-nickel
The Group has continued to explore means of monetising
the nickel-rich residues from the vanadium and molybdenum
extraction process. Although some sales of this material
have been made, the profitability has been low as a result of
high transport costs. Most of the production has, therefore,
been stockpiled, amounting now to some 5,000 tonnes
of concentrate grading at around 6% nickel content. The
treatment of this free resource on site would, therefore, be
highly profitable. A treatment process has been prepared
and proven on both a laboratory scale and with industrial
testing, and an internal concept study has been prepared
for the production of ferro-nickel in an electric arc furnace.
This is a low-cost project and discussions are ongoing with
potential customers to provide prepayment sufficient to
cover the cost of construction. The electric arc furnace will
be available after the start of the Balasausqandiq project
for the production of ferro-vanadium if this is the form of
vanadium that offtakers would prefer.
Ferro-tungsten
At the end of 2025 the Group developed and tested a
technological process for the production of ferro-tungsten
from tungsten concentrate. The technological process was
successful and in 2026 the Group is planning to negotiate
the sourcing of tungsten concentrates with a view to starting
production if sufficiently attractive terms can be agreed.
Roasting process
The Group has been working on a new process to improve
the current roasting process at the existing plant. The new
technology increases output by around 30% and lowers the
consumption of gas. This process was introduced during
April 2026 with good results.
Operational Review continued
REVIEW OF THE YEAR CORPORATE GOVERNANCE FINANCIAL STATEMENTS
Ferro-Alloy Resources Limited Annual Report 2025 9
Financial Review
Earnings
The Group reported revenues of US$4.5m for the year
compared to US$4.7m in 2024, reflecting ongoing research
and development activities of the Group in addition to the
opportunistic processing of concentrates when available.
US$’000 2025 2024
Revenue from shipments recorded at
the price at time of dispatch
4,524 4,722
Adjustments to revenue after final price
determination and fair value changes
7 16
Total revenue 4,531 4,738
Revenue is recognised at the time of transfer of control of
the Group’s products to the customer but, as is common in
the industry, the final pricing determination may be based
on assay and prices after arrival of the goods at the final
port of destination, particularly with respect to the sale of
V
2
O
5
products. The adjustments to revenue reflect these
final pricing determinations which occur after the relevant
revenue is initially recognised.
Cost of sales decreased to US$6.3m from US$7.6m in 2024,
driven by reductions in the costs of raw materials processed,
wages and general operating costs at the existing plant.
The largest part of the cost of sales is the purchase of raw
materials, the price for which is determined as a percentage
of the value of the content of vanadium or molybdenum at
the market prices prevailing at the time of purchase.
Administrative expenses of US$3.6m (2024: US$3.0m) have
increased by approximately US$0.6m during the year mainly
as a result of the costs of the equity fundraisings completed
during the year and the cost of financial advisers engaged to
identify a further strategic investor for the Company.
The Group incurred net finance costs during the year of
US$2.56m (2024: US$1.98m) almost exclusively comprising
of interest payable on the Company’s bond financing.
The Group made an overall loss for the year of US$8.42m
(2024: loss of US$9.43m).
Cashflow
Net cash outflows from operating activities, after
changes in working capital, for the year totalled US$0.9m
(2024: US$4.2m) following adjustments for depreciation,
amortisation, share based payment expenses and net
finance losses.
Net cash outflows from investing activities totalled US$3.6m
(2024: US$2.3m) the majority of which was expenditure
of US$3.4m (2024: US$2.1m) on the Phase 1 feasibility
study capitalised as an exploration and evaluation asset
(see Note 13).
Net cash inflows from financing activities for the year were
US$2.3m (2024: US$8.4m), representing the proceeds
of four equity issues completed during the year totalling
US$4.4 (2024: nil) net of interest payable to the Company’s
bondholders of US$2.12m (2024: US$1.04m).
The Group held cash of US$1.68m at 31 December 2025
(2024: US$3.78m).
Balance sheet review
Total non-current assets increased to US$14.1m from
US$12.5m principally due to the continued capitalisation of
the Group’s feasibility study costs incurred during the year
as an exploration and evaluation asset (including the transfer
of prepayments previously made on account to the lead
feasibility study consultants).
Current assets decreased from US$6.7m to US$5.2m, driven
mainly by a US$2.1m decrease in cash and cash equivalents
held by the Group at the year end offset by an US$0.54m
increase in raw materials held in year end inventories.
Total non-current liabilities decreased by approximately
US$12.1m during the year as a result of the reclassification
of the Company’s liabilities under the Kazakh bond
programme (“the Bond Programme”) from non-current to
current given the maturity during 2026 of the majority of the
tranches of bonds historically issued by the Company.
Current liabilities at the year end were US$17.0m
(2024: US$2.4m) representing the reclassification noted
above.
Ferro-Alloy Resources Limited Annual Report 202510
Corporate
During the year the Company completed a number of equity
placings that resulted in the issue of 75,907,391 shares
and a gross cash benefit to the Company of US$6,142,125
(comprised of a combination of cash receipts and suppliers
/ certain directors accepting Company shares in lieu of cash
for balances owed).
Key performance indicators
The Group is in a period of development and its current
operations, the processing of bought-in secondary
vanadium-containing materials for extraction of vanadium
and other metals and corresponding R&D, are relatively
small in comparison with the main objective of the Group
to develop the Balasausqandiq deposit and processing
facility. Moreover, the current operations are themselves
undergoing a significant change which means that
operations are not in a steady state capable of meaningful
inter-period comparisons. The board of directors (“the
Directors“ or “the Board“) are, therefore, of the opinion
that key performance indicators may be misleading if
not considered in the context of the development of
the operation as a whole for which the information for
shareholders is better given in a descriptive manner than in
tabular form.
Financial Review continued
REVIEW OF THE YEAR CORPORATE GOVERNANCE FINANCIAL STATEMENTS
Ferro-Alloy Resources Limited Annual Report 2025 11
Sustainability Review
Our approach
The Company aims to maximise value for its investors
and all stakeholders from the responsible, efficient, and
low-cost production of vanadium and other commodities
from the Balasausqandiq deposit. We seek to re-use
or recycle wherever possible and to minimise the
environmental and social impacts of our operations whilst
ensuring the health and wellbeing of the Group’s workforce.
Balasausqandiq is a unique vanadium deposit which
also contains valuable components of carbon, uranium
and molybdenum. Vanadium and the other products to
be recovered from the Balasausqandiq ore will play an
important role in the world’s transition to clean energy and a
more sustainable future.
Development of appropriate
frameworks
We have sought to minimise our environmental impacts
whilst ensuring that all employees can work safely, avoiding
accidents and reducing the risk of long-term health hazards.
We aim to comply with all applicable laws, report accurately
where required, and implement appropriate governance
standards.
As the Group grows to become a producer of critical
commodities, it will develop a comprehensive approach
to address environmental, social, health and safety issues
within an appropriate governance framework. Such
an approach will recognise the requirements of all key
stakeholders, including local communities, governments,
employees, and investors as well as customers.
To this end, the Company has appointed independent
consultants to undertake an analysis of our existing
principles, controls, procedures, and performance metrics
by comparison to the standards they believe are reasonably
applicable to the Company and its lenders and investors, in
particular, the Equator Principles and the IFC Performance
Standards. Following their initial report, their conclusions
and recommendations have been included within the
Feasibility Study.
Minimising impacts from production
We believe that any adverse environmental impact of the
future operations at Balasausqandiq will likely be significantly
below those of our peer group. We believe this can be
a source of competitive differentiation for the Company
amongst customers who are increasingly reviewing supply
chain ESG performance when sourcing vital materials.
Most of the world’s vanadium is made from titano-
vanadiferous magnetite (“TVM“). The primary production
of vanadium from TVM ore requires pre-concentration
and then roasting at approximately 1,100 degrees C
to convert the vanadium into a soluble form to enable
recovery. Roasting alone accounts for over 40% of the
energy used by one major primary producer using TVM ore.
At Balasausqandiq, the ore is different, and the proposed
process does not require pre-concentration or roasting,
significantly reducing CO
2
emissions.
The proposed production process at Balasausqandiq
involves leaching in sulphuric acid which we expect to make
by processing the sulphur that is currently removed as an
impurity from oil and gas production in Kazakhstan. The
process, which produces no CO
2
, is exothermic and requires
no significant energy input. The waste heat produced will
be used to make steam for the hydrometallurgical process,
further reducing energy requirements and CO
2
emissions.
The production of carbon from the Balasausqandiq ore
for use as carbon black in making rubber is also much
more energy efficient than competitive processes. Carbon
black is usually made by the incomplete combustion
of hydrocarbons, where only some 40% of the original
hydrocarbon input is recovered. The carbon from
Balasausqandiq is naturally occurring and avoids this
combustion of hydrocarbons and the associated emissions
of CO
2
.
Social
The Group’s operations utilise land which is unsuitable for
agricultural use and the nearest human habitation is 16
kilometres away in the village of Aksumbe. Save for some
unbounded grazing, there are no competing land uses
or requirement to re-locate communities as we develop
operations. The social impact of the operations will,
therefore, be limited. The limited requirement for additional
infrastructure further reduces the impact on the local
population.
Ferro-Alloy Resources Limited Annual Report 202512
Economic impact on the local community
Nearly all the Group’s employees are Kazakhstan nationals,
and, with the exception of specialists, most are hired from
the local villages and the nearby town of Shieli. The Group
currently employs an operating and management team of
over 200 employees. As the Group grows, it will enhance and
develop its employment policies and procedures.
The Group pays salary taxes for employees including income
tax, social security tax and pension contributions, VAT on
purchases and, in due course, will pay corporation tax
and withholding taxes. In addition, under the terms of the
Subsoil Use Agreement for the Balasausqandiq deposit, the
operating company is required, during the period of mining
and based on the subsoil activity, to pay:
• 1% of annual investment on education in Kazakhstan;
• 1.5% of annual investment on local development and
infrastructure; and
• 1% of annual profits on research and development.
In addition, the Group has signed an agreement with the
Satbayev University where selected post graduate students
will be given technical work experience opportunities with
respect to the Group’s operations.
Mine closure
The Company has prepared an environmental study in
full compliance with the laws of Kazakhstan and also aims
to meet international standards. As part of this study, a
mine closure plan has been prepared and the Company is
required to contribute 1% of annual mining costs to a mine
closure fund to ensure that funds are available when the
time comes. The Company will aim to back-fill the open pit
with waste rock from mining and contour surplus waste as
mining progresses.
Water
Water is almost fully recycled and no discharges are made
from the site. In 2025 water consumption was 17,807 m
3
(2024: 21,519 m
3
).
A hydrogeological study has been carried out to assess the
availability and sufficiency of water for processing and human
needs. Water is currently drawn using natural pressure from a
borehole. Currently, no water is discharged from operations,
although there are losses from evaporation. The Group
already recycles as much water as possible and plans to
do the same for the Balasausqandiq project. Water for the
main project will be drawn from a bore-hole some 20 km
from the operating site and transported along a pipeline.
The Balasausqandiq project process has been designed to
operate on a low liquid: solid ratio to minimise water usage
and associated reagent use.
Sustainability Review continued
REVIEW OF THE YEAR CORPORATE GOVERNANCE FINANCIAL STATEMENTS
Ferro-Alloy Resources Limited Annual Report 2025 13
Performance indicators
Health and safety
During the year, the Group had no reported health and safety incidents that led to time lost, staff requiring medical treatment
or hospitalisation and no fatalities (2024: nil).
Energy and emissions
The table below discloses the Group’s greenhouse gas emissions for 2025, including both emissions resulting from activities
for which the Group is responsible e.g. the combustion of fuel (Scope 1 emissions) and emissions resulting from the purchase
of electricity, heat or steam cooling by the Group for its own use (Scope 2 emissions).
All of the Group’s emissions have been generated outside the United Kingdom and offshore area.
Scope 1 (energy generated on site)
2025 2024
KwH
CO
2
e
(tonnes) KwH
CO
2
e
(tonnes)
Process plant
Coal for heating/steam 1,404,375 476 3,078,125 1,044
Diesel for roasting 36,960 10 239,121 64
Liquid gas for roasting 8,970,000 2,039 9,155,951 1,789
Other
Coal for heating 517,500 176 1,197,500 406
Diesel (vehicles) 152,292 40 233,308 20
Petrol (vehicles) 378,599 94 419,959 105
Total scope 1 11,459,726 2,835 14,323,964 3,428
Scope 2 (purchased electricity)
2025 2024
KwH
CO
2
e
(tonnes) KwH
CO
2
e
(tonnes)
Process plant
Whole plant 2,898,368 1,739 3,083,166 *-
Total scope 2 2,898,368 1,739 3,083,166 -
Total scope 1 and scope 2 14,358,094 4,574 17,407,130 **3,428
* this information was not available in 2024
** includes Scope 1 only (2024)
Ferro-Alloy Resources Limited Annual Report 202514
Energy consumption
The Group has consumed 14,358,094 KwH (2024: 17,407,130
KwH) of energy during the year.
All of the Group’s energy consumption has taken place
outside the United Kingdom and offshore area.
Intensity ratio
The Group will determine a suitable intensity ratio once all
relevant data is available.
Energy efficiency
The key energy efficiency adopted by the Group during the
year has been to continue to include energy saving initiatives
within the Group’s processing plant future development
planning.
Methodology
The Group has adopted the standard methodology issued by
the Kazakhstan Ministry of Ecology.
In disclosing the Group’s emissions output and energy
consumption during the year, the Company has done so on
an equity share approach. Accordingly, given that all of the
Company’s subsidiary undertakings are wholly owned by
the Company, the activities of the entire group are included
within the disclosures made.
Sustainability Review continued
REVIEW OF THE YEAR CORPORATE GOVERNANCE FINANCIAL STATEMENTS
Ferro-Alloy Resources Limited Annual Report 2025 15
Climate Change Disclosures
As a responsible corporate entity operating in the natural
resources sector, the Company is committed to the
recognition and disclosure of the potential impacts of climate
change on the Company’s and Group’s business activities.
The Company supports the initiatives and recommendations
of the Task Force on Climate-related Financial Disclosures
(“TCFD“) and has taken steps to develop climate-related
financial disclosures that it considers are consistent and
appropriate with both the recommended disclosures of
the TCFD and the current position of the Company. The
Company will review future climate change disclosures in
light of relevant IFRS issued standards.
The TCFD recommended disclosure framework comprises
four broad categories of disclosure (pillars); governance,
strategy, risk management and metrics and targets. Within
each category of recommended disclosure, the TCFD has
identified further specific disclosures that the Company
should report on. The Company has reported on this basis
below.
The Company has considered the appropriate level of detail
to be included within the various disclosures having regard
to the nature and size of the Company’s current operations
and the planned future operations following the construction
of the mine processing facilities at the Balasausqandiq
deposit.
The conclusion is that the majority of the specific disclosures
sought by the TCFD recommendations in the context of the
current operation, the purchase and treatment of vanadium-
containing concentrates and research and development
activities, are unlikely to be either useful or meaningful to the
reader of these financial statements but that the disclosures
will have far more relevance and applicability following the
commissioning of the main Balasausqandiq mine processing
facilities.
Accordingly, the disclosures noted below are provided
generally in the context of the operation of the bought-in
concentrate processing plant in addition to research and
development activities and will be expanded to cover the
future operations upon construction of the Company’s
planned mine and associated processing facilities.
The disclosures made below are consistent with the TCFD
recommendations and recommended disclosures.
Governance
1. Oversight of climate-related risks and
opportunities
The Board is ultimately responsible for the oversight of the
risks and opportunities that are presented by the potential
effects of climate change on the Company’s business
activities. The Company’s executive directors maintain
day-to-day responsibility for the recognition and effect of
climate change on the Company’s operations.
In advance of the start of mining operations, the Company
has constituted a sustainability committee, comprising the
chairman, the chief executive officer and a non-executive
director, that will guide and support the actions of the Board
with respect to climate-related matters.
2. Assessment and management of climate-
related risks
The Board in conjunction with the sustainability committee
will consider and set appropriate Company policies that will
govern how the Company’s management will assess and
manage climate-related risks and opportunities in advance
of the commissioning of the mine.
The Company’s executive directors and Group managers will
be responsible for the implementation and monitoring of the
policies set.
The management of the current operation is responsible
for assessing and managing climate-related risks and
opportunities at the existing plant.
Risk Management
3. Identification and assessment of climate-
related risks
With respect to the existing operation, the identification and
assessment of climate-related risks and opportunities is
carried out by management on an ad-hoc basis.
Once the environmental and social impact assessment
(“ESIA“) with respect to the Feasibility Study is completed,
that document will identify and assess the climate-related
risks of the main mining project and how those risks can be
managed and mitigated.
Ferro-Alloy Resources Limited Annual Report 202516
4. Processes adopted for managing climate-
related risks
With respect to the bought-in concentrate processing plant,
no specific climate change risks have been identified. The
availability of concentrates is expected to increase in the
coming years as international regulations prohibiting the
burning of low-grade fossil fuels are implemented, requiring
more use of vanadium-containing catalysts for the refining
of oil that comprise the largest part of the Group’s existing
plant feed-stock. If a climate-related risk is identified and
assessed as likely to have an impact on the operations of the
plant, the plant’s management will implement measures to
manage the impact.
In conjunction with the ESIA, an environmental and
social management system (“ESMS“) will be designed and
developed and adopted in full once the Balasausqandiq
mine has been commissioned. The ESMS will identify the
relevant processes for the management of climate-related
risks arising from the operation of the mine.
5. Integration of climate-related risk
management into the organisation’s overall
risk management
The ESIA noted above is an integral element of the
Balasausqandiq project. Accordingly, the foreseen climate-
related risks of the project (and the management / mitigation
of same) will be incorporated into the Company’s overall risk
management by virtue of the adoption of the monitoring
systems and controls recommended by the ESIA and ESMS.
Strategy
6. Climate-related risks and opportunities
Opportunities
1. Vanadium
The main climate-related opportunity presented to the
Company is the predicted expansion of the global vanadium
market as a result of the transition to a lower-carbon world
economy.
The demand for vanadium is expected to be driven by two
factors – growth of long-term energy storage solutions that
use vanadium as a key component and an increased use of
vanadium in steel making, a high carbon dioxide emitting
industry, where vanadium as an alloy material can improve
the strength of steel and consequently reduce the quantity
of steel needed.
2. Carbon
A secondary climate-related opportunity for the Company
is the carbon material found within the ore of the
Balasausqandiq deposit.
The Company’s expectation is that the carbon within the ore,
once extracted, will be capable of substituting for certain
grades of carbon black used within industries such as car
tyre manufacturing.
Carbon black is usually produced by the incomplete
combustion of hydrocarbons in specific atmospheric
conditions and typically generates significant levels of carbon
dioxide during production. The carbon in the Company’s ore
can be recovered with relatively low-level emissions which are
mostly necessary for the extraction of the principal vanadium
product. Car tyre manufacturers will, therefore, be able to cut
their supplier-related emissions by the use of this product.
Risks
The climate-related risks of the project will be identified
and evaluated by the Company’s ESIA in due course. No
significant climate-change risks to the current operation have
been identified.
7. Impact of climate-related risks and
opportunities on business, strategy and
financial planning
Climate-related risks and opportunities do not materially
impact on the business, strategy and financial planning
for the existing plant given the relatively small size of the
operation.
The impact on the Balasausqandiq deposit mining
operations will be considered by the Company’s ESIA.
8. Resilience of the organisation’s strategy
with respect to climate-related scenarios
With respect to the bought-in concentrate processing plant
and R&D centre, the plant’s management have not identified
any particular climate-related scenarios that would likely have a
significant impact on its ongoing operations. The plant already
operates in an environment that is subject to extreme weather
conditions and is, therefore, considered to have a strong
resilience to existing and future climate-related scenarios.
The resilience to climate-related scenarios for the
Balasausqandiq mining operations will be identified and
evaluated during the construction and commissioning of the
mine.
Climate Change Disclosures continued
REVIEW OF THE YEAR CORPORATE GOVERNANCE FINANCIAL STATEMENTS
Ferro-Alloy Resources Limited Annual Report 2025 17
Metrics and Targets
9. Climate related risk / opportunity metrics
Given the small-scale nature of the bought-in concentrate
processing plant and R&D centre, the Company will develop
metrics to assess climate-related risks and opportunities
in line with its strategy and risk management processes
once the Balasausqandiq mining operation has been
commissioned.
10. Energy and emissions
Relevant emissions statistics are disclosed within the
Sustainability Review on page 11.
11. Climate-related risk / opportunity
performance targets
Given the small-scale nature of the bought-in concentrate
processing plant and R&D centre, the Company will develop
performance targets to manage climate-related risks and
opportunities in line with its strategy and risk management
processes once the Balasausqandiq mining operation has
been commissioned.
Ferro-Alloy Resources Limited Annual Report 202518
Alignment Status
The following table provides a summary of the Group’s current alignment with the TCFD recommendations:
TCFD pillar Recommended disclosure Current status Alignment
Governance Oversight of climate-related risks and
opportunities
Oversight provided by the board of
directors. Sustainability committee formed.
Comply
Assessment and management of
climate-related risks
Current operations: climate-related risks
assessed and managed by incumbent
management team. Main mine climate-
related risks to be determined by the board
of directors following mine commissioning.
Partial
Risk
management
Identification and assessment of
climate-related risks
Identification and assessment of climate-
related risks for current operations
completed by incumbent management.
Identification and assessment of climate-
related risks for the main mine to be
captured by the ESIA.
Partial
Processes adopted for managing
climate-related risks
On an ad-hoc basis by the incumbent
management team with respect to current
operations. ESMS being developed for the
main mine for adoption on commissioning
of the main mine.
Partial
Integration of climate-related risk
management into the organisation’s
overall risk management
Integration to occur following the adoption
of the ESIA and ESMS.
Planned
Strategy Climate-related risks and
opportunities
Identified and considered above. Comply
Impact of climate-related risks and
opportunities on business, strategy
and financial planning
No material impact on current operations.
Impact on the main mine to be considered
by the ESIA.
Partial
Resilience of the organisation’s
strategy with respect to climate-
related scenarios
No climate-related scenarios identified with
respect to current operations.
Resilience of the strategy with respect to
climate-related scenarios for the main mine
will be tested following construction and
commissioning.
Partial
Metrics and
targets
Climate related risk / opportunity
metrics
To be adopted following the commissioning
of the main mine.
Planned
Energy and emissions Disclosure with respect to current
operations completed.
Comply
Climate-related risk / opportunity
performance targets
To be adopted following the commissioning
of the main mine.
Planned
Climate Change Disclosures continued
REVIEW OF THE YEAR CORPORATE GOVERNANCE FINANCIAL STATEMENTS
Ferro-Alloy Resources Limited Annual Report 2025
19
Principal Risks and Uncertainties
Description of principal risks,
uncertainties and how they are
managed
(a) Balasausqandiq project:
The Project is primarily dependent on long-term vanadium
prices.
The Project is also dependent on raising finance to meet
projected capital costs (see below) and the successful
construction and commissioning of the Project’s proposed
mine processing facilities. It is not unusual for new mining
projects to experience unforeseen problems, incur unexpected
costs and be exposed to delays during construction,
commissioning, and initial production, all of which could have
a material adverse effect on the Company’s operations and
financial position. The Company has taken steps to mitigate
such potential adverse effects by engaging globally recognised
engineers and consultants to assist with the development and
design of the key elements of the Project in addition to the
Group’s own highly qualified workforce.
(b) Geopolitical situation:
While the ongoing invasion of Ukraine by Russia is not
directly impacting the Group, the Directors remain vigilant
of the situation. The continued main risk of the conflict
is to the Group’s transport routes, many of which involve
transit through Russia. Whilst these are currently operating
without issue, sanctions have been made against Russian
and Belarusian vehicles transiting through Europe (but not
against vehicles registered in other jurisdictions in the region
such as Kazakhstan). There is a risk that further sanctions
might prevent transit through Russia into Latvia, through
which the majority of the Company’s exports flow. The
Company continues to review alternative transit routes for
raw material imports and product exports through the West
of Kazakhstan, either via the Caspian Sea or overland south
of the Caspian Sea. Routes to China are working normally.
With respect to the global sanctions imposed on certain
Russian entities and individuals, the Group monitors the
implications of those sanctions on the Group’s trading
activities on an ongoing basis.
The Company has not yet identified any risks applicable to
the Group due to the ongoing conflict in the Middle East but
will continue to monitor the situation.
(c) Financing risk:
The Balasausqandiq project will require substantial funds to
be raised in debt and equity which will be dependent upon
market conditions at the time.
In March 2021 the Company signed an investment
agreement with Vision Blue Resources Ltd (“Vision Blue”).
Under the terms of this agreement and in addition to Vision
Blue’s participation in various secondary equity fundraises
completed by the Company, investments totalling US$16m
have been made by Vision Blue. Vision Blue holds options
to subscribe up to US$30m at pre-agreed prices to partially
finance the construction of the project.
The favourable financial and other characteristics of the
Feasibility Study give the Directors confidence that the
outcome of project will be successful.
(d) Climate change risk:
Refer to the Sustainability Review on page 11 and the
Climate Change Disclosures on page 15.
(e) Risks associated with the developing
nature of the Kazakh economy:
According to the World Bank, Kazakhstan has transitioned
from lower-middle-income to upper-middle-income status in
less than two decades. Kazakhstan’s regulatory environment
has similarly developed and the Company believes that
the period of rapid change and high risk is coming to an
end. Nevertheless, the economic and social regulatory
environment continues to develop and there remain some
areas where regulatory risk is greater than in developed
economies. The Company mitigates this risk by monitoring
developments in these regulatory environments on a regular
basis and taking relevant actions where required.
(f) Commodity price risk:
As already noted above, the success of the Company is
dependent upon the long-term prices of the products to
be produced by the planned mine processing facilities. As a
result of there being no formally established trading markets
for the Company’s principal products from the Project,
there is a risk that price fluctuations and volatility for these
products may have an adverse impact on the Company’s
future financial performance. The Company will mitigate
this risk by regularly reviewing third party commodity
pricing forecasts and considering hedging opportunities, as
appropriate.
Ferro-Alloy Resources Limited Annual Report 2025
20
(g) Key personnel risk:
The Group is dependent upon its executive management
team. Whilst it has entered into contractual agreements
at market rates with the aim of securing the services of
these personnel, the retention of their services cannot be
guaranteed. The development and success of the Group
depends on its ability to recruit and retain high quality and
experienced staff. The loss of the service of key personnel
or the inability to attract additional qualified personnel as
the Group grows could have an adverse effect on future
financial performance. The Company mitigates this risk by
regularly reviewing and revising, where necessary, executive
management remuneration and incentivisation packages
against market rates and by maintaining an open dialogue
on key personnel matters.
(h) Foreign currency risk:
Fluctuations in currency exchange rates, principally between
the US Dollar and Kazakhstan Tenge could adversely impact
the Group’s future earnings and cash flows. The Company
mitigates this risk by maintaining appropriate internal foreign
exchange rate policies.
Principal Risks and Uncertainties continued
Ferro-Alloy Resources Limited Annual Report 2025
21
REVIEW OF THE YEAR CORPORATE GOVERNANCE FINANCIAL STATEMENTS
General
As a result of the ordinary shares of the Company being
classified on the Official List of the London Stock Exchange
as Equity Shares (Transition), the requirements of the UK
Corporate Governance Code, published by the Financial
Reporting Council, do not apply to the Company. The
Guernsey Finance Sector Code of Corporate Governance does
not apply to the Company since the Company is not regulated
by the Guernsey Financial Services Commission. However,
the Board recognises the importance of good corporate
governance and has implemented recognised corporate
governance practices as far as is considered appropriate
by the Board whilst considering the size and nature of the
business.
The Board is responsible for the overall corporate governance
of the consolidated Group, guiding and monitoring the
business and affairs of the Company on behalf of the
shareholders by whom they are elected and to whom they are
accountable.
Composition of the Board
Having regard to the Company’s stage of development,
the Directors believe that the size of the current board
comprising seven directors, three of whom are executive and
four are non-executive, is appropriate. The Directors intend
that there will always be at least as many non-executive
directors as there are executive directors.
Board committees
Audit
The Company has created an audit committee that is
responsible for considering all financial reporting matters
and ensuring that they are properly reported and monitored.
It is also responsible for the review and assessment of the
independence of the external auditors and approval of any
non-audit services, review of the external audit strategy and
findings, assessment of whether an internal audit function is
necessary considering the activities and size of the business
and oversight of significant financial reporting matters.
The committee is chaired by James Turian and Christopher
Thomas is a member. Mr Turian has a background in
accounting, trust and management and is a director of a
firm of accountants in Guernsey which the Board considers
to be recent and relevant experience to carry out his
responsibilities as chairman.
Remuneration
The Company has also created a remuneration committee
to consider all matters related to salary and benefits of
senior staff and executive directors. The remuneration of
non-executive directors is a matter for the Board as a whole.
No director will take part in discussions concerning his own
remuneration package. Mr Thomas is the chairman of the
committee and Mr Turian is a member.
Nomination
The Directors are of the opinion that due to the nature and
size of the Company and its current Board, the functions
often carried out by a nomination committee can be more
successfully conducted by the full board of directors and so
no such committee has been created.
Sustainability
The Company has constituted a sustainability committee
comprising the chairman, the chief executive officer and
a non-executive director that will guide and support the
actions of the Board with respect to sustainability related
matters, particularly once construction of the mine has
commenced.
Code of conduct
The goal of establishing the Company as a significant
mining and processing company is underpinned by its core
values of honesty, integrity, common sense and respect
for people. The Company desires to be a good corporate
citizen in all the jurisdictions within which it operates, and to
appropriately balance, protect and preserve all stakeholders’
interests. In particular, the Company gives paramount
concern to the safety of its employees and the maintenance
of high environmental standards.
Shareholder communication
The Board aims to ensure that shareholders and investors
have equal access to Company information.
The Company aims to promote effective communication
with shareholders and encourage effective participation
at general meetings through a policy of open disclosure
to shareholders, regulatory authorities and the broader
community of all material information with respect to the
Company’s affairs.
Governance Statement
Ferro-Alloy Resources Limited Annual Report 2025
22
Internal control and risk
management systems
The Company’s accounting and finance team is relatively
small and subject to close control by the executive directors.
For this reason, the audit committee and the Board are
of the opinion that it is not yet appropriate for there to be
a separate internal control department or internal audit
function but has implemented various procedures and
internal controls to provide assurance to the Directors that
accounting and financial risks are adequately controlled.
These include:
• The preparation and regular updating of cash flow
forecasts, changes to which are closely monitored by the
executive directors who discuss necessary changes on an
almost daily basis;
• Significant contracts require approval by the Directors
and approval must follow a specified approval processes;
and
• All Group payments must be authorised by a director
and payments by the Company require two directors’
signatures on all payments over US$10,000.
Governance Statement continued
Ferro-Alloy Resources Limited Annual Report 2025
23
REVIEW OF THE YEAR CORPORATE GOVERNANCE FINANCIAL STATEMENTS
Sir Mick Davis
Non-executive Chairman
Sir Mick Davis holds a number
of directorships at private
companies and is a highly
successful mining executive
accredited with building Xstrata
plc into one of the largest mining
companies in the world prior to
its acquisition by Glencore plc.
Before listing Xstrata on the LSE
as CEO he was CFO of Billiton
plc and Chairman of Billiton
Coal which he joined from the
position of Eskom CFO.
During his career in mining he
has raised almost US$40bn
from global capital markets
and successfully completed
over US$120bn of corporate
transactions, including the
creation of the Ingwe Coal
Corporation in South Africa; the
listing of Billiton on the LSE; the
merger of BHP and Billiton; as
well as numerous transactions
at Xstrata culminating in the sale
to Glencore plc.
Sir Mick Davis is a Chartered
Accountant by profession,
and holds an honours degree
in Commerce from Rhodes
University, South Africa and an
Honorary Doctorate from Bar
Ilan University, Israel.
William Callewaert
Chief Financial Officer
William graduated in 2002 from
the University of Durham with
an honours degree in Law after
which he trained as a Chartered
Accountant in audit services
with leading tax, accounting and
business advisory firm, Blick
Rothenberg. Having qualified
in 2006, William’s career
progressed within advisory
services at Grant Thornton,
KPMG and BDO in both the UK
and offshore.
William is responsible for the
overall management of the
Group’s finances, future funding
requirements and general
statutory compliance. William
is a fellow of the Institute of
Chartered Accountants in
England and Wales.
Nicholas Bridgen
Chief Executive Officer
Nick started his career in 1975
as a Chartered Accountant at
Peat Marwick Mitchell & Co (now
KPMG). In 1979, he moved to
the Rio Tinto Group, becoming
senior group accountant in
1981. He then moved to the
Business Evaluation Department
for the Group in 1985 and was
Group Planning Manager for the
RTZ Pillar Group which held the
engineering, building products
and chemical companies. Nick
spent 14 years with Rio Tinto. In
the mid-1990s, he was finance
director at Bakyrchik Gold
plc and in 1998, he founded
Hambledon Mining plc which
acquired the Sekisovskoye gold
project, listing the company
on AIM and taking the project
from exploration, through
construction and into a
producing mine.
Since 2006, Nick has been a
director and more recently,
CEO, of Ferro-Alloy Resources
Limited. In the role of CEO, Nick
is ultimately responsible for
all aspects of the Ferro-Alloy
Resources Group. He holds a
Bachelor’s degree with honours
from Exeter University, is a
Chartered Accountant and has
also studied corporate finance
at the London Business School.
He speaks Russian.
Andrey Kuznetsov
Director of Operations
Andrey started his career
in 1981 as an industrial
engineer at Kirov Engineering
Plant in Almaty. After three
years he became Chief of the
Scientific Department in the
Central Committee of Youth
(Comsomol). In 1987, Andrey
became general director of the
Almaty NTTM “Kontakt” centre.
In 1995-1996, he was the CEO
of the Kazakhstan subsidiary
of Alfa-Bank. Andrey has been
the general director of Firma
Balausa LLC since 2006. He
holds a Specialist’s degree in
electrical engineering from
Bauman Moscow State Technical
University and a PhD in informal
mathematical logic. He has
also studied management at
Coventry University.
As Director of Operations
Andrey is responsible for the
management of operations in
Kazakhstan and execution of the
Company strategy and policies
approved by the Board.
Board of Directors
Ferro-Alloy Resources Limited Annual Report 2025
24
Christopher Thomas
Non-executive Director
(Chairman of the
remuneration committee
and member of the audit
committee)
Chris has nearly 35years’
experience in the
communications industry. He
has held various high-level
management positions including
CEO of Proximity London
from 2003 to 2006 - one of
the largest direct and digital
agencies in London. In 2006,
Chris was appointed Chairman
& CEO of BBDO and Proximity
in Asia, subsequently adding
the Middle East and Africa to
his responsibilities. He worked
with major multinational
companies across the growth
markets of SE Asia, China, India
and Africa. In May 2015, Chris
moved to New York to take up
the role of CEO of BBDO in the
Americas, with responsibility for
21 agencies in the U.S., Canada
and Latin America. In February
2019 he stepped down from his
Americas role to concentrate on
his entrepreneurial interests. He
also served as a non-executive
director on the board of
Hambledon Mining from 2004
to 2011.
Chris is the chairman of the
remuneration committee
which considers and approves
the remuneration of all senior
executives including that of the
executive directors. He is also a
member of the Company’s audit
committee.
Petrus Nienaber
Non-executive Director
Peet has several decades of
experience in the mining sector,
most notably spending over
24 years with what became
Xstrata plc. At Xstrata he was
initially Head of Operations,
spearheading the earliest days of
the company, including its growth
to be the largest producer
of ferrochrome. Thereafter
he spent 10 years as CEO of
Xstrata Alloys, one of the largest
producers of ferrochrome and
a leading producer of vanadium,
with some 20,000 people under
Peet’s leadership. After retiring
from the position in 2012, Xstrata
Alloys subsequently went on to
be acquired by Glencore plc.
Peet began his career as an
engineer at Iscor Ltd before
spending several years in the
ferroalloys industry at Samancor
and Anglo American plc.
James Turian
Non-executive Director
(Chairman of the audit
committee and member
of the remuneration
committee)
James started his career in
1986 and has a background
in accounting, trust and
management. James has
previously been involved with
several mining companies
in Perth, Australia, including
assisting Cooper Energy in
their restructuring in the early
2000s. From 2000 to 2011
James owned and operated
a trust company in Guernsey
which he sold to concentrate
on accountancy and currently
is a director of “Accounts For
You Limited”, a Guernsey
accountancy firm. He holds
several other directorships.
James is a Chartered Fellow of
the Securities Institute IAQ and
is a Fellow of the Institute of
Directors.
James is the chairman of the
audit committee where he is
responsible for chairing the
audit committee meetings.
Board of Directors continued
Ferro-Alloy Resources Limited Annual Report 2025
25
REVIEW OF THE YEAR CORPORATE GOVERNANCE FINANCIAL STATEMENTS
Andrey Kuznetsov
Deputy Director of
Operations
Having graduated from the
Saint-Petersburg State University
with a Masters in Mathematics
and Bachelor in Economics
Andrey started his career as a
management consultant with
boutique consultancy firm,
Strategica. Andrey then joined
Danish company Dinex, in
Russia, as a finance director
for two years before moving to
Denmark to complete an MBA
at the Copenhagen Business
School.
Post MBA, Andrey joined Danish
company ECCO where he spent
almost 8 years in various roles
across Denmark, Netherlands
and Russia. Andrey’s final role
at ECCO was General Manager
East, where he was responsible
for ECCO distribution markets
in Russia, Ukraine, Georgia,
Moldova and Bulgaria.
Andrey joined the Group in
2019 as the finance director
of the Company’s Kazakhstan
subsidiary, Firma Balausa LLC.
In 2022, Andrey was appointed
deputy general director of Firma
Balausa LLC to support the
general director with operations
and the Feasibility Study.
Senior Management Team
Ferro-Alloy Resources Limited Annual Report 2025
26
The Directors present their report and the audited
consolidated financial statements for the year ended
31December 2025.
General
in Guernsey as a non-cellular limited company .
The Company’s registered office is Maison Allaire, Smith
principal place of business of the Group is Kazakhstan.
Principal activity
Review of business
A review of the business during the year is included within
the Operational Review at page 7.
The Group’s business and operations and the results thereof
are reflected in the attached financial statements.
The principal risks and uncertainties facing the Company are
summarised at page 19.
Results and dividend
During the 12 months ended 31 December 2025, the
Company reported a loss of US$8.4m (2024: loss of
US$9.4m).
No dividends have been declared or paid in respect of the
years ending 2025 or 2024.
Share capital and funding
The ordinary shares of the Company were listed on the
standard segment of the main market of the London Stock
Exchange on 28 March 2019 and, on a fully fungible basis, on
the Astana International Stock Exchange on 6 January 2020.
Full details of the Company’s share capital, together with
details of the movements in the Company’s issued share
capital during the year, are set out in Note 20 to the
consolidated financial statements on page 55.
Directors
The Board is comprised of three executive directors and four
non-executive directors.
Current directors
The directors of the Company who held office during the
year and to the date of this report are as follows:
Sir Mick Davis
Nicholas Bridgen
Andrey Kuznetsov
William Callewaert
Christopher Thomas
Petrus Nienaber
James Turian
The biographical details of those directors that served during
the year are set out at pages 23 to 24.
Election and re-election of directors
In accordance with the Company’s Articles of Incorporation,
any director who has been appointed by the Board since
the date of the previous annual general meeting or who
has not previously retired at the two preceding annual
general meetings shall stand for election or re-election at the
next general meeting. However, for the purposes of good
corporate governance, all directors put themselves forward
for re-election at each annual general meeting.
At the Company’s annual general meeting held on
14November 2025, all appointed directors were re-elected
to their respective roles.
Attendance at scheduled Company board
meetings
Scheduled (5)
Sir Mick Davis 5
Nicholas Bridgen 5
Andrey Kuznetsov 5
William Callewaert 5
Christopher Thomas 5
Petrus Nienaber
5
James Turian
5
Directors’ Report
Ferro-Alloy Resources Limited Annual Report 2025
27
REVIEW OF THE YEAR CORPORATE GOVERNANCE FINANCIAL STATEMENTS
Remuneration
Salary/ fees
($’000)
Benefits
($’000)
Pension
($’000)
Bonus/other
($’000)
Total
($’000)
2024 2025 2024 2025 2024 2025 2024 2025 2024 2025
Sir Mick Davis - - - - - - - - - -
Nicholas Bridgen 271 273 47 62 - - - - 318 335
Andrey Kuznetsov 211 197 - - - - - - 211 197
William Callewaert 239 273 4 7 - - - - 243 280
Christopher Thomas 48
1
48 - - - - - - 48 48
Petrus Nienaber 48
1
48 - - - - - - 48 48
James Turian 48
1
48 - - - - - - 48 48
Total 865 887 51 69 - - - - 916 956
1
Remuneration paid to each of these directors was by way of Company shares.
Director’s interests in the issued share capital of the Company
The interests of the Directors in the Company’s issued share capital at 31 December 2025 and at the date of the signing of this
report are as follows:
29 Apr 2026
Number of
Ordinary
Shares
29 Apr 2026
% of Share
Capital
31 Dec 2025
Number of
Ordinary
Shares
31 Dec 2025
% of Share
Capital
31 Dec 2024
Number of
Ordinary
Shares
31 Dec 2024
% of Share
Capital
Sir Mick Davis
1
- -
1
- -
1
- -
Nicholas Bridgen 62,847,740 10.69 62,847,740 11.24 59,472,133 12.31
Andrey Kuznetsov 71,101,823 12.10 71,101,823 12.72 68,517,333 14.18
Christopher Thomas
2
8,119,610 1.38
2
8,119,610 1.45
2
6,456,845 1.34
James Turian 1,662,765 0.28 1,662,765 0.30 500,000 0.10
Petrus Nienaber 1,193,162 0.20 1,193,162 0.21 - -
1
Sir Mick Davis is the Chairman of Vision Blue Resources Limited and the beneficiary of a Trust that is a shareholder in Vision Blue Resources Limited
and, therefore, he indirectly has an interest in that company’s investment in Ferro-Alloy Resources Limited arising from the investment agreement
inplace between the two entities.
2
including shares of Assiduous Group Limited which holds 7,574,898 (2024: 5,912,133) ordinary shares. Assiduous Group Limited is an investment
vehicle in which Christopher Thomas is the sole shareholder and director.
Substantial Shareholdings
A list of shareholders who beneficially hold more than 5% of the Company’s shares at 31 December 2025 is as follows:
Name of shareholder Number of Ordinary Shares Percentage of voting rights
Vision Blue Resources Limited 125,805,974 22.50%
Andrey Kuznetsov 71,101,823 12.72%
Nicholas Bridgen 62,847,740 11.24%
Directors’ Indemnity Insurance
During the year, Director’s and Officer’s liability insurance was
maintained for the Directors and other officers of the Group.
Political Donations
The Group did not make any political donations during
theyear.
Ferro-Alloy Resources Limited Annual Report 2025
28
Electronic Communications
The Directors are responsible for ensuring that the
Company’s annual report and financial statements are made
available on a website. Financial statements are published on
the Company’s website (www.ferro-alloy.com) in accordance
with applicable legislation in Guernsey governing the
preparation and dissemination of financial statements,
which may vary from legislation in other jurisdictions. The
maintenance and integrity of the Company’s website is the
responsibility of the Directors. The Directors’ responsibility
also extends to the ongoing integrity of the financial
statements contained therein.
Board Diversity
In accordance with UK Listing Rule 22.3.30, the Company has
not met the required targets with respect to board diversity
given the Company’s stage of development and size. The
Directors recognise the importance of diversity in both the
workplace and at board level and will take steps towards
achieving the requirements of UK Listing Rule 22.3.30.
Going Concern
The consolidated financial statements have been prepared in
accordance with IFRS on a going concern basis.
The operations of the Group are financed from a
combination of cash flows generated by the existing
operation, bond issues and funds raised from shareholders
and strategic investors. In common with many pre-
production entities, the Group will need to raise further
funds in order to progress from the feasibility study phase
into construction and ultimately into production. The
Directors consider the ability of the Company to raise further
funding to be a material uncertainty.
With respect to the Bond Programme, a number of the
tranches previously issued under the programme will come
to maturity during 2026 and the Company will need to either
fund these redemptions in cash or by alternative non-cash
methods. The Directors consider the ability of the Company
to fund the upcoming redemptions required by the Bond
Programme to be a material uncertainty. Further information
on the tranches issued under the Bond Programme is
disclosed at Note 21.
These conditions indicate the existence of a material
uncertainty, which may cast doubt over the Group’s ability
to continue as a going concern, and therefore that it may
be unable to realise its assets and discharge its liabilities in
the normal course of business. The financial statements do
not include adjustments that would arise in the event of the
Group not being able to continue as a going concern.
Following the publication of the Feasibility Study, the
Directors are confident based on their previous experience
and success in raising capital that the Company will be
able to secure further funding to address the material
uncertainties noted above and, therefore, the Company will
continue as agoing concern for at least the next 12 months.
Accordingly, the Directors believe that it is appropriate that
the Company adopts the going concern basis of accounting
in preparation of these financial statements.
Events Occurring After the Reporting
Period
On 10 March 2026, the Company issued 28,621,701 shares
raising gross proceeds of £1,574,193.55.
Auditor
Crowe U.K. LLP has expressed its willingness to continue
inoffice as auditor and a resolution to re-appoint Crowe
U.K.LLP will be proposed at the Company’s forthcoming
annual general meeting.
Statement as to Disclosure of
Information to Auditor
The Directors who were in office at the date of the approval
of the consolidated financial statements have confirmed
that, as far as they are aware, there is no relevant audit
information of which the Company’s auditor is unaware and
that each director has taken all the steps he ought to have
taken as a director to make himself aware of any relevant
audit information and to establish that the Company’s
auditor is aware of that information.
Approved by the Board of Directors and signed on its behalf
William Callewaert
Director
29 April 2026
Directors’ Report continued
Ferro-Alloy Resources Limited Annual Report 2025
29
REVIEW OF THE YEAR CORPORATE GOVERNANCE FINANCIAL STATEMENTS
The Companies (Guernsey) Law, 2008 requires the Directors
to prepare financial statements for each financial period
which give a true and fair view of the state of affairs of the
Group for that period and of the profit or loss of the Group
for that period. Under that law they have elected to prepare
the financial statements in accordance with International
Financial Reporting Standards as adopted by the European
Union and applicable law.
In preparing those financial statements the Directors are
required to:
• Select suitable accounting policies and then apply them
consistently;
• Make judgements and estimates that are reasonable and
prudent;
• State whether applicable accounting standards have been
followed, subject to any material departures disclosed
and explained in the financial statements; and
• Prepare the financial statements on the going concern
basis unless it is inappropriate to presume that the Group
will continue in business.
The Directors are responsible for keeping proper accounting
records which disclose with reasonable accuracy at any time
the financial position of the Group and to enable them to
ensure that the financial statements have been properly
prepared in accordance with the Companies (Guernsey) Law,
2008. They are also responsible for safeguarding the assets
of the Group and hence for taking reasonable steps for the
prevention and detection of fraud and other irregularities.
The Directors confirm that they have complied with the
above requirements in preparing the financial statements.
To the best of the Directors’ knowledge:
a) the financial statements, prepared in accordance with
International Financial Reporting Standards as adopted
by the European Union and applicable law, give a true
and fair view of the assets, liabilities, financial position and
profit or loss of Ferro-Alloy Resources Limited and the
undertakings included in the consolidation as a whole;
and
b) the management report includes a fair review of the
development and performance of the business and
the position of Ferro-Alloy Resources Limited and the
undertakings included in the consolidation taken as a
whole, together with a description of the principal risks
and uncertainties that they face.
On behalf of the Board of Directors
William Callewaert
Director
29 April 2026
Directors’ Responsibility Statement
Ferro-Alloy Resources Limited Annual Report 2025
30
Opinion
We have audited the financial statements of Ferro-Alloy
Resources Limited and its subsidiaries (the “Group”)
for the year ended 31 December 2025 which comprise
the consolidated statement of profit or loss or other
comprehensive income, consolidated statement of financial
position, consolidated statement of changes in equity and
consolidated 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 International Financial
Reporting Standards (IFRSs) as adopted by the European
Union.
In our opinion, the financial statements:
• give a true and fair view of the state of the Group’s affairs
as at 31 December 2025 and of its loss for the year then
ended;
• have been properly prepared in accordance with
International Financial Reporting Standards as adopted by
the European Union;
• have been prepared in accordance with the requirements
of the Companies (Guernsey) Law 2008.
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 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(d) in the financial statements,
which indicates that the Group will need to refinance its
bonds that mature within twelve months of the date of
approval of the financial statements. They will also require
further funding to continue exploration and evaluation works
on the Balasuasqandiq project, and to fund its overheads
during the going concern assessment period.
As stated in note 1(d), these events or conditions, along with
the other matters as set forth in note 1(d), indicate that a
material uncertainty exists that may cast significant doubt
on the Group’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 directors’ 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 entity’s
ability to continue to adopt the going concern basis of
accounting included;
• Assessing the accuracy of forecasting by comparing
previous forecasts with actual results;
• Assessing the cash flow requirements of the Group
over the duration of the going concern period based on
budgets and forecasts;
• Challenging the forecast expenditure that is committed,
and that which could be considered discretionary;
• Discussing with management their plans for refinancing
the Group’s bonds, and assessing the feasibility of this,
including consideration of information provided by the
Group’s legal advisor;
• Considering the liquidity of existing assets in the
statement of financial position; and
• Considering the potential downside scenarios and the
resultant impact on available funds.
Our responsibilities and the responsibilities of the directors
with respect to going concern are described in the relevant
sections of this report.
Overview of our audit approach
Materiality
In planning and performing our audit we applied the concept
of materiality. An item is considered material if it could
reasonably be expected to change the economic decisions
of a user of the financial statements. We used the concept
of materiality to both focus our testing and to evaluate the
impact of misstatements identified.
Based on our professional judgement, we determined
overall materiality for the financial statements as a whole
to be $280,000 (2024: $250,000), based on approximately
1.5% of total assets.
We use a different level of materiality (‘performance
materiality’) to determine the extent of our testing for the
audit of the financial statements. Performance materiality
is set based on the audit materiality as adjusted for the
judgements made as to the entity risk and our evaluation
Independent Auditor’s Report
to the members of Ferro-Alloy Resources Limited
Ferro-Alloy Resources Limited Annual Report 2025
31
REVIEW OF THE YEAR CORPORATE GOVERNANCE FINANCIAL STATEMENTS
of the specific risk of each audit area having regard to the
internal control environment. We determined performance
materiality to be $196,000 (2024: $175,000).
Where considered appropriate performance materiality
may be reduced to a lower level, such as, for related party
transactions and directors’ remuneration.
We agreed with the Audit Committee to report to it all
identified errors in excess of $14,000 (2024: $12,500). Errors
below that threshold would also be reported to it if, in our
opinion as auditor, disclosure was required on qualitative
grounds.
Overview of the scope of our audit
The Group operates through the Parent Company based
in Guernsey whose main function is the incurring of
administrative costs and providing funding to the operating
entities in Kazakhstan. In addition to the Parent Company,
the subsidiary Firma Balausa LLC was considered to be a
significant component.
In establishing our overall approach to the Group audit, we
determined the type of work that needed to be performed
in respect of each component. A full scope audit of both
the Parent Company and Firma Balausa LLC subsidiary
was carried out principally in Kazakhstan by a component
auditor, at the direction of instructions provided by the
Group auditor. The consolidation was audited by the Group
auditor. The remaining components of the Group were
considered non-significant and these components were
subject to analytical procedures performed by the Group
auditor.
Our involvement with component auditors
In respect of the work performed by the component auditor,
we determined the level of involvement needed in order to
be able to conclude whether sufficient appropriate audit
evidence has been obtained as a basis for our opinion
on the consolidated financial statements as a whole.
Our involvement with the component auditor included the
following:
• Detailed group instructions were sent to the component
auditor, which included the significant areas to be
covered by the audit (including areas that were deemed
to be key audit matters as detailed below), the level of
component materiality, and set out the information
required to be reported on to the Group auditor;
• The Group auditor team reviewed the component
auditor’s working papers at their offices in Kazakhstan
and held regular calls with the component auditor
throughout the engagement;
• We held calls and meetings with Group and component
management to discuss accounting and audit matters
arising.
Members of the Group audit team visited Kazakhstan to
meet with local management and substantiate information
and explanations provided during the audit work.
Ferro-Alloy Resources Limited Annual Report 2025
32
Independent Auditor’s Report continued
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 period 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.
We identified going concern as a key audit matter and have detailed our response in the section headed Material Uncertainty
Related to Going Concern above.
This is not a complete list of all risks identified in the audit.
Key audit matter How our scope addressed the key audit matter
1. Carrying value of Exploration and
Evaluation assets (note 13)
The Group carried Exploration and Evaluation
assets totalling $10.5m (2024: $7.9m) in
relation to the Balasausqandiq deposit in
Kazakhstan. These costs have been capitalised
in accordance with the requirements of IFRS 6.
At each reporting date, the Directors are
required to assess whether there are any
indicators of impairment, that would require
an impairment assessment to be carried out.
The Directors concluded that there were no
indicators of impairment.
The Directors’ consideration of the impairment
indicators requires them to make certain
judgements, which makes this a key audit
matter.
We obtained and reviewed the Directors’ assessment of the indicators
of impairment, as set out in IFRS 6 “Exploration for and evaluation
of mineral resources”. The following procedures were performed to
challenge the Directors’ conclusion that no indications of impairment
were present:
• We obtained a copy of the Group’s subsoil use agreement, and
confirmed that it remains valid;
• We reviewed correspondence with the Government licensing
body during the year, including in relation to the application for
Addendum No. 5 to the subsoil use agreement;
• We made specific enquiries of the Directors and key staff
involved in the exploration work, and challenged management to
demonstrate that further exploration work in the area covered
by the subsoil use agreement was planned and had been
incorporated in budgets and forecasts;
• We considered the output of the Definitive Feasibility Study in
the context of the commercial feasibility of the Balasausqandiq
project, and in the recoverability of capitalised exploration and
development costs;
• We performed an assessment of the objectivity and competence of
the Experts who prepared the Definitive Feasibility Study;
• We held discussions with the Experts who prepared the Definitive
Feasibility Study to understand their approach and any further
works required to refine the results;
• We reviewed the adequacy of disclosures in the financial
statements in relation to the impairment consideration.
Ferro-Alloy Resources Limited Annual Report 2025
33
REVIEW OF THE YEAR CORPORATE GOVERNANCE FINANCIAL STATEMENTS
Key audit matter How our scope addressed the key audit matter
2. Revenue recognition (note 4)
The Group generated revenues of $4.5m (2024:
$4.72m) during the year.
In considering application of IFRS 15 “Revenue
from Contracts with Customers”, particular
attention was required in the following areas:
– The identification of performance obligations
in the contract, and the point at which
performance obligations are satisfied and
when revenue is recognised, which can be
specific to each contract.
– The accounting for variable consideration
associated with estimates of quality and
quantity for sales during the year, which are
subject to final checks post year end.
Given the level of judgement and estimation
involved, we considered revenue recognition to
represent a significant audit risk and therefore a
key audit matter.
We performed the following procedures:
• We assessed the Group’s contracts and revenue recognition
policy against the 5-step model of IFRS 15 to consider the
appropriateness of the accounting policy.
• We obtained and reviewed sales agreements for a sample of
customers to assess the appropriateness and application of
the accounting policy. Specific consideration was given to the
identification of performance obligations and the timing and
circumstances at which these are satisfied.
• We evaluated the appropriateness of management’s accounting
treatment for the provisional pricing clauses for open sales, and for
the estimation of quality and quantity of amounts, comparing these
to actual outcomes post year end.
• We obtained sales confirmation letters from the Group’s key
customers, covering 81% of revenue;
• We agreed a sample of revenue transactions to documentation
supporting shipping and delivery of goods, ensuring that revenue
had been recognised at the appropriate point according to the
terms of the contract.
• For a sample of sales around the year end, we vouched to
documentation supporting their inclusion in the correct accounting
period.
• We reviewed financial statements disclosures to ensure these were
compliant with IFRS 15.
Our audit procedures in relation to these matters were designed in the context of our audit opinion as a whole.
They were not designed to enable us to express an opinion on these matters individually and we express no such opinion.
Other information
The directors are responsible for the other information contained within the annual report. The other information comprises
the information included in the annual report, other than the financial statements and our auditor’s report thereon. Our
opinion on the 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.
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 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.
Ferro-Alloy Resources Limited Annual Report 2025
34
Independent Auditor’s Report continued
Matters on which we are required to
report by exception
Under The Companies (Guernsey) Law, 2008, we are
required to report to you if, in our opinion:
• we have not received all the information and explanations
we require for our audit; or
• proper accounting records have not been kept; or
• the financial statements are not in agreement with the
accounting records.
We have no exceptions to report arising from this
responsibility.
Responsibilities of the directors for
the financial statements
As explained more fully in the directors’ responsibilities
statement set out on page 29, the directors are responsible
for the preparation of the 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 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 Company and 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
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 legal and
regulatory frameworks that are applicable to the Group
and the procedures in place for ensuring compliance.
These included the Companies (Guernsey) Law 2008,
Listing Rules and the significant laws and regulations
in Kazakhstan including the terms of the subsoil use
agreement, tax legislation and environmental legislation.
• As part of our audit planning process, we assessed the
different areas of the financial statements, including
disclosures, for the risk of material misstatement. This
included considering the risk of fraud where direct
enquiries were made with management and those
charged with governance concerning both whether they
had any knowledge of any actual or suspected fraud
and their assessment of the susceptibility to fraud. We
considered the risk to be greater in areas involving
significant management estimation or judgement. Based
on this assessment, we designed audit procedures to
focus on these specific areas.
• We tested the appropriateness of journal entries
throughout the year by vouching a risk-based sample of
journals to supporting documentation and explanations.
• A detailed review of the Group’s year end adjusting
entries was performed. Any items that appeared
unusual in nature or value were vouched to supporting
documentation.
Owing to the inherent limitations of an audit, there is an
unavoidable risk that some material misstatements of the
financial statements may not be detected, even though the
audit is properly planned and performed in accordance with
the ISAs (UK). The potential effects of inherent limitations are
particularly significant in the case of misstatement resulting
from fraud because fraud may involve sophisticated and
carefully organized schemes designed to conceal it, including
deliberate failure to record transactions, collusion or
intentional misrepresentations being made to us.
A further description of our responsibilities for the audit of
the financial statements is available on the Financial Reporting
Council’s website at: www.frc.org.uk/auditorsresponsibilities.
This description forms part of our auditor’s report.
Ferro-Alloy Resources Limited Annual Report 2025
35
REVIEW OF THE YEAR CORPORATE GOVERNANCE FINANCIAL STATEMENTS
Use of our report
This report is made solely to the company’s members, as
a body, in accordance with Section 262 of the Companies
(Guernsey) Law 2008. 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.
Matthew Stallabrass
Senior Statutory Auditor
For and on behalf of
Crowe U.K. LLP
Statutory Auditor
London, U.K.
Date: 29 April 2026
Ferro-Alloy Resources Limited Annual Report 2025
36
| 2025 | 2024 | ||
| Note | $000 | $000 | |
Revenue from customers (pricing at shipment) | 4 | ||
Final pricing adjustments after delivery | 4 | ||
Total revenue | 4 | ||
Cost of sales | 5 | ( | ( |
Gross loss | ( | ( | |
Other income | 6 | ||
Administrative expenses | 7 | ( | ( |
Impairment loss | 12 | ( | |
Distribution expenses | ( | ( | |
Other expenses | 8 | ( | ( |
Loss from operating activities | ( | ( | |
Net finance costs | 10 | ( | ( |
Loss before income tax | ( | ( | |
Income tax | 11 | ||
Loss for the period | ( | ( | |
| Other comprehensive loss | |||
| Items that may be reclassified subsequently to profit or loss | |||
Exchange differences arising on translation of foreign operations | ( | ( | |
Total comprehensive loss for the period | ( | ( | |
Loss per share (basic and diluted) (US$) | 20 | ( | ( |
Consolidated Statement
of Profit or Loss and Other
Comprehensive Income
for the year ended 31 December 2025
Ferro-Alloy Resources Limited Annual Report 2025
37
REVIEW OF THE YEAR CORPORATE GOVERNANCE FINANCIAL STATEMENTS
| 31 December 2025 | 31 December 2024 | ||
| Note | $000 | $000 | |
| ASSETS | |||
| Non-current assets | |||
Property, plant and equipment | 12 | ||
Exploration and evaluation assets | 13 | ||
Intangible assets | 14 | ||
Prepayments | 18 | ||
Total non-current assets | |||
| Current assets | |||
Inventories | 16 | ||
Trade and other receivables | 17 | ||
Prepayments | 18 | ||
Cash and cash equivalents | 19 | ||
Total current assets | |||
Total assets | |||
| EQUITY AND LIABILITIES | |||
| Equity | |||
Share capital | 20 | ||
Additional paid-in capital | |||
Share-based payment reserve | 20 | ||
Foreign currency translation reserve | ( | ( | |
Accumulated losses | ( | ( | |
Total equity | ( | ( | |
| Non-current liabilities | |||
Loans and borrowings | 21 | ||
Lease liabilities | |||
Provisions | 22 | ||
Total non-current liabilities | |||
| Current liabilities | |||
Loans and borrowings | 21 | ||
Trade and other payables | 23 | ||
Deferred income | 24 | ||
Total current liabilities | |||
Total liabilities | |||
Total equity and liabilities |
The notes on pages 40 to 67 form part of these consolidated financial statements.
Consolidated Statement of
Financial Position
as at 31 December 2025
Ferro-Alloy Resources Limited Annual Report 2025
38
Consolidated Statement of
Changes in Equity
for the year ended 31 December 2025
| Share- | Foreign | |||||
| Additional | based | currency | ||||
| Share | paid in | payment | translation | Accumulated | ||
| capital | capital | reserve | reserve | losses | Total | |
| $000 | $000 | $000 | $000 | $000 | $000 | |
Balance at 1 January 2024 | ( | ( | ||||
Loss for the year | ( | ( | ||||
| Other comprehensive expenses | ||||||
Exchange differences arising on translation of foreign operations | ( | ( | ||||
Total comprehensive loss for the year | ( | ( | ( | |||
| Transactions with owners, recorded | ||||||
| directly in equity | ||||||
Other transactions recognised directly in equity | ||||||
Balance at | ( | ( | ( | |||
Balance at | ( | ( | ( | |||
Loss for the year | ( | ( | ||||
| Other comprehensive expenses | ||||||
Exchange differences arising on translation of foreign operations | ( | ( | ||||
Total comprehensive loss for the year | ( | ( | ( | |||
| Transactions with owners, recorded | ||||||
| directly in equity | ||||||
Shares issued, net of issue costs (Note 20) | ||||||
Other transactions recognised directly in equity | ||||||
Balance at 31 December 2025 | ( | ( | ( |
Ferro-Alloy Resources Limited Annual Report 2025
39
REVIEW OF THE YEAR CORPORATE GOVERNANCE FINANCIAL STATEMENTS
Note
| 2025 | 2024 | ||
| $000 | $000 | ||
| Cash flows from operating activities | |||
Loss for the year | ( | ( | |
| Adjustments for: | |||
Depreciation and amortisation | 12, 14 | ||
Impairment of plant and equipment | 12 | ||
Profit on sale of plant and equipment | 6, 12 | ( | |
Write-off of property, plant and equipment | 8 | ||
Write-down of inventory to net realisable value | 8 | ||
Write-down of prepayments | 8 | ||
Share-based payment expense | 20 | ||
Net finance costs | 10 | ||
| Cash used in operating activities before changes in working | ( | ( | |
| capital | |||
Change in inventories | 16 | ( | |
Change in trade and other receivables | 17 | ( | |
Change in prepayments | 18 | ||
Change in trade and other payables | 23 | ( | |
Change in deferred income | 24 | ( | |
Net cash used in operating activities | ( | ( | |
| Cash flows from investing activities | |||
Acquisition of property, plant and equipment | 12 | ( | ( |
Acquisition of exploration and evaluation assets | 13 | ( | ( |
Acquisition of intangible assets | 14 | ( | |
Proceeds from the disposal of plant and equipment | 6 | ||
Net cash used in investing activities | ( | ( | |
| Cash flows from financing activities | |||
Proceeds from issue of share capital | 20 | ||
Proceeds from borrowings | 21 | ||
Issue costs on borrowings | 21 | ( | |
Interest paid | 21 | ( | ( |
Net cash from financing activities | |||
Net (decrease)/increase in cash and cash equivalents | ( | ||
Cash and cash equivalents at the beginning of the year | 19 | ||
| Effect of movements in exchange rates on cash and cash | ( | ||
| equivalents | |||
Cash and cash equivalents at the end of the year |
Consolidated Statement of
CashFlows
for the year ended 31 December 2025
Ferro-Alloy Resources Limited Annual Report 2025
40
| Company’s share | |||
Company | Location | in share capital | Primary activities |
Energy Metals Limited | UK | 100% | Dormant |
Vanadium Products LLC | Kazakhstan | 100% | Performs services for the Group |
Firma Balausa LLC | Kazakhstan | 100% | Production and sale of vanadium and |
| associated by-products | |||
Balausa Processing Company LLC | Kazakhstan | 100% | Dormant |
Notes to the Consolidated
Financial Statements
for the year ended 31 December 2025
Ferro-Alloy Resources Limited Annual Report 2025
41
REVIEW OF THE YEAR CORPORATE GOVERNANCE FINANCIAL STATEMENTS
2 Use of estimates and judgements
Preparing the financial statements requires management to make judgements, estimates and assumptions that affect the
application of accounting policies and the reported amounts of assets and liabilities, income and expenses. Actual results may
differ from these estimates.
Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in
the period in which the estimates are revised and in any future periods affected.
Judgements that relate to estimation uncertainty
Inventories (Note 16)
The Group holds material inventories which are assessed for impairment at each reporting date. The assessment of net
realisable value requires consideration of future cost to process and sell and spot market prices at year end less applicable
discounts. The estimates are based on market data and historical trends.
Trade and other receivables (Note 17)
The Group holds trade and other receivable balances at the year end which are assessed for recoverability at each reporting
date. The assessment of recoverability is based on estimates of future receipts taking into consideration past receipt patterns
and trends.
Judgements that do not relate to estimation uncertainty
Exploration and evaluation assets (Note 13)
The Group holds material exploration and evaluation assets and judgement is applied in determining whether impairment
indicators exist under the Group’s accounting policy. In determining that no impairment indicator exists management have
considered the Group’s Feasibility Study on the asset, the strategic plans for exploration and future development and the status
of the Subsoil Use Agreement. Judgement was required in determining that the application for deferral of obligations under the
Subsoil Use Agreement (Note 26) will be granted, given that approval is a procedural matter, and not discretionary, under the
Kazakhstan national Subsoil Use legislation. Management anticipate such approvals being provided given their understanding
of the Kazakh market and plans for the asset. In the event that approval is not received, the Group will consider the options
available to it to effect approval under the provisions of the Kazakhstan national Subsoil Use legislation.
Additionally, judgement was required in determining that the Group’s exploration and evaluation asset should continue to be
classified as such an asset rather than transitioning to classification as a development asset. Management has concluded that
until the final investment decision for the development of the asset has been determined by the Board then the asset should
continue to be classified as an exploration and evaluation asset.
3 Material accounting policies
The accounting policies set out below have been applied consistently to all periods presented in these consolidated financial
statements and have been applied consistently by Group entities, except for the implementation of new standards and
interpretations.
Ferro-Alloy Resources Limited Annual Report 2025
42
Notes to the Consolidated Financial Statements continued
Ferro-Alloy Resources Limited Annual Report 2025
43
REVIEW OF THE YEAR CORPORATE GOVERNANCE FINANCIAL STATEMENTS
Ferro-Alloy Resources Limited Annual Report 2025
44
Notes to the Consolidated Financial Statements continued
Ferro-Alloy Resources Limited Annual Report 2025
45
REVIEW OF THE YEAR CORPORATE GOVERNANCE FINANCIAL STATEMENTS
Ferro-Alloy Resources Limited Annual Report 2025
46
Notes to the Consolidated Financial Statements continued
Ferro-Alloy Resources Limited Annual Report 2025
47
REVIEW OF THE YEAR CORPORATE GOVERNANCE FINANCIAL STATEMENTS
Ferro-Alloy Resources Limited Annual Report 2025
48
| 2025 | 2024 | |
| $000 | $000 | |
Sales of vanadium products | 2,550 | 3,076 |
Sales of ferro-molybdenum | 1,929 | 1,517 |
Sales of gravel and waste rock | 45 | - |
Service revenue | - | 129 |
Total revenue from customers under IFRS 15 | 4,524 | 4,722 |
Other revenue - change in fair value of customer contracts | 7 | 16 |
Total revenue | 4,531 | 4,738 |
| 2025 | 2024 | |
| $000 | $000 | |
Materials | 4,361 | 4,729 |
Wages, salaries and related taxes | 1,225 | 1,401 |
Depreciation | 375 | 783 |
Electricity | 136 | 139 |
Other | 156 | 498 |
6,253 | 7,550 |
Notes to the Consolidated Financial Statements continued
Ferro-Alloy Resources Limited Annual Report 2025
49
REVIEW OF THE YEAR CORPORATE GOVERNANCE FINANCIAL STATEMENTS
6 Other income
| 2025 | 2024 | |
| $000 | $000 | |
Currency conversion gain | 11 | 5 |
Other (sales of equipment) | 59 | 45 |
70 | 50 |
| 2025 | 2024 | |
| $000 | $000 | |
Wages, salaries and related taxes | 1,781 | 1,688 |
Professional services | 235 | 332 |
Taxes other than income tax | 54 | 71 |
Listing and reorganisation expenses | 498 | 163 |
Audit | 170 | 124 |
Materials | 36 | 48 |
Rent | 64 | 37 |
Repairs and maintenance | - | 1 |
Depreciation and amortisation | 66 | 70 |
Insurance | 46 | 45 |
Staff training | 15 | 69 |
Bank fees | 18 | 18 |
Travel expenses | 37 | 44 |
Utilities | 4 | 4 |
Communication and information services | 15 | 16 |
Other | 526 | 292 |
3,565 | 3,022 |
| 2025 | 2024 | |
| $000 | $000 | |
Currency conversion loss | 57 | 49 |
Write-down of inventory to net realisable value | 205 | 71 |
Write-down of obsolete assets | - | 2 |
Write-down of prepayments | 40 | 273 |
Share-based payment expense | 34 | 22 |
Other | 168 | 146 |
504 | 563 |
Ferro-Alloy Resources Limited Annual Report 2025
50
9 Personnel costs
| 2025 | 2024 | |
| $000 | $000 | |
Wages, salaries and related taxes | 2,997 | 3,640 |
2,997 | 3,640 |
During 2025 personnel costs of US$694,000 (2024: US$1,401,000) have been charged to cost of sales, US$1,884,000 (2024:
US$1,688,000) to administrative expenses and US$523,000 (2024: US$551,000) were charged to cost of inventories which
were not yet sold as at the year end.
The average number of Group employees, excluding the Directors, during the year was 176 (2024: 196).
| 2025 | 2024 | |
| $000 | $000 | |
Net foreign exchange costs | 558 | 337 |
Unwinding of discount on bonds | 3 | 302 |
Interest expense on financial liabilities (bonds) | 1,996 | 1,340 |
Net finance costs | 2,557 | 1,979 |
11 Income tax
The Group’s applicable tax rates in 2025 are an income tax rate of 20% for Kazakhstan registered subsidiaries (2024: 20%) and
0% (2024: 0%) for Guernsey registered companies. The Kazakh tax rate has been applied below as this is most reflective of the
Group’s trading operations and tax profile.
During the years ended 31 December 2025 and 2024 the Group incurred tax losses and, therefore, did not recognise any
current income tax expense.
Unrecognised deferred tax assets are described in Note 15.
Reconciliation of effective tax rate:
2025 | 2024 | |||
$000 | % | $000 | % | |
Loss before tax (Group) | (8,415) | 100 | (9,429) | 100 |
Income tax at the applicable tax rate | (1,683) | 20 | (1,886) | 20 |
| Effect of unrecognised deferred tax assets / (losses | 2,424 | (31) | 822 | (7) |
| carried forward) | ||||
| Net non-deductible expenses/non-taxable income | (741) | (11) | 1,064 | (13) |
| or loss | - | - | - | - |
Notes to the Consolidated Financial Statements continued
Ferro-Alloy Resources Limited Annual Report 2025
51
REVIEW OF THE YEAR CORPORATE GOVERNANCE FINANCIAL STATEMENTS
12 Property, plant and equipment
| Land and | Plant and | Construction | |||||
| buildings | equipment | Vehicles | Computers | Other | in progress | Total | |
| $000 | $000 | $000 | $000 | $000 | $000 | $000 | |
| Cost | |||||||
Balance at 1 January 2024 | 5,015 | 3,822 | 522 | 49 | 256 | 242 | 9,906 |
Additions | - | 64 | - | 2 | 50 | 88 | 204 |
Transfers | 62 | 186 | - | - | - | (248) | - |
Disposals | - | (104) | (2) | (3) | (3) | - | (112) |
| Foreign currency | (667) | (520) | (68) | (6) | (36) | (16) | (1,313) |
| translation difference | |||||||
| Balance at 31 December | 4,410 | 3,448 | 452 | 42 | 267 | 66 | 8,685 |
| 2024 | |||||||
Balance at 1 January 2025 | 4,410 | 3,448 | 452 | 42 | 267 | 66 | 8,685 |
Additions | 28 | 250 | - | - | 3 | - | 281 |
Disposals | - | (126) | - | (10) | (22) | - | (158) |
| Foreign currency | 185 | 151 | 18 | 1 | 9 | 2 | 366 |
| translation difference | |||||||
| Balance at 31 December | 4,623 | 3,723 | 470 | 33 | 257 | 68 | 9,174 |
| 2025 | |||||||
Depreciation and impairment | |||||||
Balance at 1 January 2024 | 851 | 2,621 | 361 | 33 | 89 | - | 3,955 |
Depreciation for the period | 432 | 438 | 33 | 6 | 52 | - | 961 |
Impairment charge | - | 954 | - | - | - | - | 954 |
Disposals | - | (102) | (2) | (3) | (2) | - | (109) |
| Foreign currency | (75) | (463) | (51) | (5) | (17) | - | (611) |
| translation difference | |||||||
| Balance at 31 December | 1,208 | 3,448 | 341 | 31 | 122 | - | 5,150 |
| 2024 | |||||||
Balance at 1 January 2025 | 1,208 | 3,448 | 341 | 31 | 122 | - | 5,150 |
Depreciation for the period | 378 | 28 | 26 | 4 | 19 | - | 455 |
Disposals | - | (126) | - | (10) | (4) | - | (140) |
| Foreign currency | 61 | 13 | 15 | 1 | 14 | - | 104 |
| translation difference | |||||||
| Balance at 31 December | 1,647 | 3,363 | 382 | 26 | 151 | - | 5,569 |
| 2025 | |||||||
| Carrying amounts | |||||||
At 1 January 2024 | 4,164 | 1,201 | 161 | 16 | 167 | 242 | 5,951 |
At 31 December 2024 | 3,202 | - | 111 | 11 | 145 | 66 | 3,535 |
At 31 December 2025 | 2,976 | 360 | 88 | 7 | 106 | 68 | 3,605 |
Ferro-Alloy Resources Limited Annual Report 2025
52
During 2025 a depreciation expense of US$375,000 (2024: US$783,000) has been charged to cost of sales, excluding cost of
finished goods that were not sold at year end, US$66,000 (2024: US$70,000) to administrative expenses, and US$94,000 has
been charged to cost of finished goods that were not sold at the year end (2024: US$189,000).
Impairment
On 2 December 2024, the Company announced that save where profitable concentrates could be sourced and treated, the
Company’s existing plant would be switched to research and development activities to complete and optimise the ongoing
feasibility study, including the development of markets for the Company’s carbon black substitute product.
IAS 36 stipulates that an entity shall assess at the end of each reporting period whether there is any indication that an asset
may be impaired. If any such indication exists, the entity shall estimate the recoverable amount of the asset.
With reference to IAS 36, during 2024 the Directors determined that the plant and equipment elements of the Company’s
property, plant and equipment i.e. those assets attributable to the existing operation, should be impaired in full until such time
that the existing operation reverted back to operating as a full time concentrate processing plant or other cash generating
commercial activities. During 2025 the existing plant continued to undertake R&D activities and accordingly the Directors have
determined that the impairment charge recognised in 2024 (US$954,000) should not be reversed during 2025.
13 Exploration and evaluation assets
The Group’s exploration and evaluation assets relate to the Balasausqandiq deposit. During the year, the Group capitalised the
cost of technical design, sample assaying and project management costs, all relating to the Company’s Feasibility Study. As at
31 December 2025 the carrying value of exploration and evaluation assets was US$10.5m (2024: US$8.0m).
| 2025 | 2024 | |
| $000 | $000 | |
Balance at 1 January | 7,999 | 7,145 |
Additions (Stage 1 feasibility study) | 3,387 | 1,619 |
Foreign currency translation difference | (906) | (765) |
Balance at 31 December | 10,480 | 7,999 |
Notes to the Consolidated Financial Statements continued
Ferro-Alloy Resources Limited Annual Report 2025 53
REVIEW OF THE YEAR CORPORATE GOVERNANCE FINANCIAL STATEMENTS
| Mineral | Computer | |||
| rights | Patents | software | Total | |
| $000 | $000 | $000 | $000 | |
| Cost | ||||
Balance at 1 January 2024 | 84 | 34 | 3 | 121 |
Additions | - | 2 | 1 | 3 |
Foreign currency translation difference | (11) | (5) | (1) | (17) |
Balance at 31 December 2024 | 73 | 31 | 3 | 107 |
Balance at 1 January 2025 | 73 | 31 | 3 | 107 |
Foreign currency translation difference | 3 | 2 | - | 5 |
Balance at 31 December 2025 | 76 | 33 | 3 | 112 |
| Amortisation | ||||
Balance at 1 January 2024 | 84 | 14 | 3 | 101 |
Amortisation for the year | - | 1 | - | 1 |
Foreign currency translation difference | (11) | (2) | - | (13) |
Balance at 31 December 2024 | 73 | 13 | 3 | 89 |
Balance at 1 January 2025 | 73 | 13 | 3 | 89 |
Amortisation for the year | - | 1 | - | 1 |
Foreign currency translation difference | 3 | 1 | - | 4 |
Balance at 31 December 2025 | 76 | 15 | 3 | 94 |
| Carrying amounts | ||||
At 1 January 2024 | - | 20 | - | 20 |
At 31 December 2024 | - | 18 | - | 18 |
At 31 December 2025 | - | 18 | - | 18 |
| 2025 | 2024 | |
| $000 | $000 | |
Temporary deductible differences | (203) | 599 |
Tax losses carried forward | 30,380 | 23,791 |
Unrecognised tax deferred tax assets | (30,177) | (24,390) |
- | - |
Ferro-Alloy Resources Limited Annual Report 202554
Notes to the Consolidated Financial Statements continued
Expiry year | $000 |
2026 | 708 |
2027 | 424 |
2028 | 455 |
2029 | 1,898 |
2030 | 2,991 |
2031 | 1,392 |
2032 | 3,489 |
2033 | 2,695 |
2034 | 10,137 |
2035 | 5,806 |
| 29,995 |
16 Inventories
| 2025 | 2024 | |
| $000 | $000 | |
Raw materials and consumables | 1,060 | 516 |
Finished goods | 230 | 287 |
Work in progress | 28 | 71 |
1,318 | 874 |
During 2025 inventories expensed to profit and loss amounted to US$4.4m (2024: US$4.7m).
| 2025 | 2024 | |
| $000 | $000 | |
| Current | ||
Trade receivables from third parties | 264 | 319 |
Due from employees | 76 | - |
VAT receivable | 1,040 | 781 |
Other receivables | - | 195 |
1,380 | 1,295 | |
Expected credit loss provision for receivables | (73) | (58) |
1,307 | 1,237 |
Ferro-Alloy Resources Limited Annual Report 2025 55
REVIEW OF THE YEAR CORPORATE GOVERNANCE FINANCIAL STATEMENTS
| 2025 | 2024 | |
| $000 | $000 | |
| Non-current | ||
Prepayment for E&EA | - | 964 |
Other prepayments | 1 | 7 |
1 | 971 | |
| Current | ||
Prepayments for goods and services | 931 | 853 |
931 | 853 |
19 Cash and cash equivalents
| 2025 | 2024 | |
| $000 | $000 | |
Cash at current bank accounts | 1,613 | 209 |
Cash at bank deposits | 70 | 3,567 |
Petty cash | 1 | 1 |
Cash and cash equivalents | 1,684 | 3,777 |
| Ordinary shares | ||
| 31 December | 31 December | |
| 2025 | 2024 | |
Par value | - | - |
Outstanding at beginning of year | 483,222,238 | 483,222,238 |
Shares issued | 75,907,391 | - |
Outstanding at end of year | 559,129,629 | 483,222,238 |
| Number of | Cash proceeds | Non cash benefit | |
| Date of admission | shares issued | (US$) | (US$) |
6 January 2025 | 1,764,983 | 10,000 | 208,377 |
12 March 2025 | 8,657,115 | - | 872,553 |
10 July 2025 | 16,666,667 | 1,310,276 | 54,188 |
11 November 2025 | 20,638,879 | 1,329,181 | 289,692 |
10 December 2025 | 28,179,747 | 1,731,499 | 336,359 |
Total | 75,907,391 | 4,380,956 | 1,761,169 |
Ferro-Alloy Resources Limited Annual Report 202556
Notes to the Consolidated Financial Statements continued
| 2025 | |
| share | |
| options | |
Outstanding at the beginning of the year | 1,000,000 |
Granted during the year | 1,000,000 |
Exercised during the year | - |
Expired / cancelled during the year | - |
Outstanding at the year end | 2,000,000 |
| Number of | Exercise price | |||
| Grant date | options | Exercise date | per share (US$) | Expiry date |
29 June 2022 | 250,000 | 29 June 2025 | 0.162 | 29 June 2027 |
22 September 2022 | 250,000 | 22 September | 0.151 | 22 September |
| 2025 | 2027 | |||
12 September 2023 | 500,000 | 12 September | 0.116 | 12 September |
| 2026 | 2028 | |||
2 May 2025 | 1,000,000 | 2 May 2028 | 0.088 | 2 May 2030 |
| 2,000,000 |
| Share-based | |
| payment | |
| reserve (US$) | |
At 1 January 2025 | 42,210 |
Exercise of share options | - |
Issue of options | - |
Payment expense recognised for the year | 34,439 |
At 31 December 2025 | 76,649 |
Ferro-Alloy Resources Limited Annual Report 2025 57
REVIEW OF THE YEAR CORPORATE GOVERNANCE FINANCIAL STATEMENTS
Grant date | 2 May 2025 |
Share price at grant date (US$) | 0.0829 |
Exercise price (US$) | 0.0829 |
Expected volatility* | 197.3% |
Expected life (years) | 3 |
Expected dividend yield (US$) | - |
Risk-free interest rate** | 3.995% |
Fair value per option (US$) | 0.076 |
| 2025 | 2024 | |
| $000 | $000 | |
Loss for the year, attributable to owners of the Company | (8,415) | (9,429) |
Loss attributable to ordinary shareholders | (8,415) | (9,429) |
| Shares | 2025 | 2024 |
Issued ordinary shares at 1 January (after subdivision) | 483,222,238 | 483,222,238 |
Effect of shares issued (weighted) | 22,090,787 | - |
Weighted-average number of ordinary shares at 31 December | 505,313,025 | 483,222,238 |
Loss per share of common stock attributable to the Company (basic and diluted) (US$) | (0.017) | (0.020) |
Ferro-Alloy Resources Limited Annual Report 202558
Notes to the Consolidated Financial Statements continued
| 2025 | 2024 | |
| $000 | $000 | |
| Non-current liabilities | ||
Bonds payable | 5,000 | 17,134 |
5,000 | 17,134 | |
| Current liabilities | ||
Bonds payable | 12,563 | - |
Interest payable | 309 | 432 |
12,872 | 432 |
| Effective | Nominal | Actual | |||||
| interest | amount | amount | Coupon | Coupon | |||
USD | Currency | rate | $000 | $000 | rate | paid | Interest |
Bonds payable | USD | 9.2% | 3,000 | 2,898 | 9% | 270 | 271 |
Bonds payable | USD | 10.4% | 5,000 | 4,874 | 10% | 625 | 500 |
Bonds payable | USD | 11.0% | 5,000 | 5,003 | 11% | 550 | 550 |
Bonds payable | USD | 13.5% | 5,000 | 5,000 | 13.5% | 675 | 675 |
18,000 | 17,775 | 2,120 | 1,996 |
| 2025 | 2024 | |
| $000 | $000 | |
| Loans and borrowings | ||
At 1 January | 17,566 | 7,527 |
| Cash flows: | ||
– Interest paid | (2,120) | (1,041) |
– Repayment of loans and borrowings | - | - |
– Proceeds from loans and borrowings | - | 10,003 |
Total | 15,446 | 16,489 |
| Non-cash flows | ||
– Interest accruing in period | 1,996 | 1,340 |
– Bond discount / premium | 430 | (263) |
At 31 December | 17,872 | 17,566 |
Ferro-Alloy Resources Limited Annual Report 2025 59
REVIEW OF THE YEAR CORPORATE GOVERNANCE FINANCIAL STATEMENTS
| 2025 | 2024 | |
| $000 | $000 | |
Balance at 1 January | 24 | 31 |
Change in estimate | 4 | (3) |
Foreign currency translation difference | 1 | (4) |
Balance at 31 December | 29 | 24 |
Non-current | 29 | 24 |
29 | 24 |
23 Trade and other payables
| 2025 | 2024 | |
| $000 | $000 | |
Trade payables | 2,910 | 1,273 |
Debt to employees | 189 | 188 |
Other taxes | 186 | 310 |
Advances received | 801 | 72 |
4,086 | 1,843 |
24 Deferred income
| 2025 | 2024 | |
| $000 | $000 | |
Government grants | - | 102 |
- | 102 |
During 2023, the Group was awarded grant funding by the Kazakhstan National Scientific Council for the development of
technology for the production of mixed vanadium oxides for use in VRFBs.
Ferro-Alloy Resources Limited Annual Report 202560
Notes to the Consolidated Financial Statements continued
| Carrying amount | ||
| 2025 | 2024 | |
| $000 | $000 | |
Trade and other receivables, excluding amounts due from employees and VAT receivable | 264 | 319 |
Cash and cash equivalents | 1,683 | 3,777 |
1,947 | 4,096 |
| Carrying amount | ||
| 2025 | 2024 | |
| $000 | $000 | |
Kazakhstan | 264 | 319 |
264 | 319 |
| Carrying amount | ||
| 2025 | 2024 | |
| $000 | $000 | |
| Trade receivables: | ||
Wholesale customers | 264 | 319 |
264 | 319 |
Ferro-Alloy Resources Limited Annual Report 2025 61
REVIEW OF THE YEAR CORPORATE GOVERNANCE FINANCIAL STATEMENTS
| Gross | Impairment | Net | Gross | Impairment | Net | |
| 2025 | 2025 | 2025 | 2024 | 2024 | 2024 | |
| $000 | $000 | $000 | $000 | $000 | $000 | |
Not past due | 264 | - | 264 | 319 | - | 319 |
Past due more than 180 days | 73 | (73) | - | 58 | (58) | - |
337 | (73) | 264 | 377 | (58) | 319 |
| 2025 | 2024 | |
| $000 | $000 | |
Balance at beginning of the year | 58 | 47 |
Expected gain change | 15 | 11 |
Balance at end of the year | 73 | 58 |
| Carrying | Contractual | 6 months - | ||||
| amount | cash flows | On demand | 0-6 mths | 1 year | 1-3 years | |
| 2025 | $000 | $000 | $000 | $000 | $000 | $000 |
| Financial liabilities | ||||||
Trade and other payables | 2,910 | 2,910 | - | 2,910 | - | - |
Loans and borrowings | 17,872 | 17,872 | - | 863 | 13,735 | 3,274 |
20,782 | 20,782 | - | 3,773 | 13,735 | 3,274 |
| Carrying | Contractual | 6 months - | ||||
| amount | cash flows | On demand | 0-6 mths | 1 year | 1-3 years | |
| 2024 | $000 | $000 | $000 | $000 | $000 | $000 |
| Financial liabilities | ||||||
Trade and other payables | 1,273 | 1,273 | - | 1,273 | - | - |
Loans and borrowings | 17,566 | 21,970 | - | 1,430 | 998 | 19,542 |
18,839 | 23,243 | - | 2,703 | 998 | 19,542 |
Ferro-Alloy Resources Limited Annual Report 202562
Notes to the Consolidated Financial Statements continued
| US$- | GBP- | EUR- | RUB- | KZT- | |
| denominated | denominated | denominated | denominated | denominated | |
| 2025 | 2025 | 2025 | 2025 | 2025 | |
| 2025 | $000 | $000 | $000 | $000 | $000 |
Cash and cash equivalents | 1 | 1,480 | - | - | 203 |
Trade and other payables | - | - | - | - | (4,085) |
Loans and borrowings | (17,872) | - | - | - | - |
Net exposure | (17,871) | 1,480 | - | - | (3,882) |
| US$- | GBP- | EUR- | RUB- | KZT- | |
| denominated | denominated | denominated | denominated | denominated | |
| 2024 | 2024 | 2024 | 2024 | 2024 | |
| 2024 | $000 | $000 | $000 | $000 | $000 |
Cash and cash equivalents | 3,500 | 142 | - | 5 | 130 |
Trade and other payables | (959) | - | (98) | (43) | (895) |
Loans and borrowings | (17,566) | - | - | - | - |
Net exposure | (15,025) | 142 | (98) | (38) | (765) |
Average rate | Reporting date spot rate | |||
| in US$ | 2025 | 2024 | 2025 | 2024 |
KZT 1 | 0.0019 | 0.0021 | 0.0020 | 0.0019 |
GBP 1 | 1.3184 | 1.2784 | 1.3518 | 1.2589 |
RUB 1 | 0.0120 | 0.0108 | 0.0128 | 0.0095 |
EUR 1 | 1.1304 | 1.0818 | 1.1773 | 1.0438 |
Ferro-Alloy Resources Limited Annual Report 2025 63
REVIEW OF THE YEAR CORPORATE GOVERNANCE FINANCIAL STATEMENTS
| 2025 | 2024 | |
| $000 | $000 | |
| Financial assets (includes cash) | ||
Trade and other receivables | 264 | 319 |
Cash at amortised cost | 1,683 | 3,777 |
1,947 | 4,096 | |
| Financial liabilities – measured at amortised cost | ||
Trade and other payables at amortised cost | 2,910 | 1,273 |
Loans and borrowings at amortised cost | 17,872 | 17,566 |
20,782 | 18,839 |
Ferro-Alloy Resources Limited Annual Report 202564
Notes to the Consolidated Financial Statements continued
Year | Tonnes |
| 2023 | 567,700 |
| 2024 | 788,100 |
| 2025 | 1,102,300 |
| 2026 | 1,102,300 |
| 2027 | 1,102,300 |
| 2028 | 1,102,300 |
| 2029 onwards | 1,102,300 |
Ferro-Alloy Resources Limited Annual Report 2025 65
REVIEW OF THE YEAR CORPORATE GOVERNANCE FINANCIAL STATEMENTS
28 Segment reporting
The Group’s assets are primarily concentrated in the Republic of Kazakhstan and the Group’s revenues are derived from
operations in, and connected with, the Republic of Kazakhstan.
| Processing | Subsoil | Corporate | Total | |
| 2025 | $000 | $000 | $000 | $000 |
Revenue | 4,531 | - | - | 4,531 |
Cost of sales | (6,253) | - | - | (6,253) |
Other income | 69 | - | 1 | 70 |
Administrative expenses | (1,078) | (28) | (2,459) | (3,565) |
Other expenses | (470) | - | (34) | (504) |
Distribution expenses | (137) | - | - | (137) |
Finance costs | (525) | - | (2,032) | (2,557) |
Loss before tax | (3,863) | (28) | (4,524) | (8,415) |
| Processing | Subsoil | Corporate | Total | |
| 2024 | $000 | $000 | $000 | $000 |
Revenue | 4,738 | - | - | 4,738 |
Cost of sales | (7,550) | - | - | (7,550) |
Other income | 49 | - | 1 | 50 |
Administrative expenses | (1,132) | (40) | (1,850) | (3,022) |
Impairment charge | (954) | - | - | (954) |
Other expenses | (541) | - | (22) | (563) |
Distribution expenses | (149) | - | - | (149) |
Finance costs | 394 | - | (2,373) | (1,979) |
Loss before tax | (5,145) | (40) | (4,244) | (9,429) |
Included in revenue arising from processing are revenues of US$4,420,000 (2024: US$4,500,000) which arose from sales to
four of the Group’s largest customers. No other single customer contributes 10 per cent or more to the Group’s revenue.
All of the Group’s assets are attributable to the Group’s processing operations.
Ferro-Alloy Resources Limited Annual Report 202566
Sales to the Group’s largest customers in 2024 were as follows:
Customer A US$0.3m (8%) (2024: US$1.5m (31%))
Customer B US$1.9m (52%) (2024: US$1.9m (40%))
Customer C US$0.8m (19%) (2024: US$nil (0%))
Customer D US$0.8m (19%) (2024: US0.7m (14%))
| 2025 | 2024 | |
| $000 | $000 | |
Wages, salaries and related taxes | 1,074 | 1,053 |
30 Subsequent events
On 10 March 2026, the Company issued 28,621,701 shares raising gross proceeds of £1,574,193.55.
Notes to the Consolidated Financial Statements continued
Ferro-Alloy Resources Limited Annual Report 2025 67
REVIEW OF THE YEAR CORPORATE GOVERNANCE FINANCIAL STATEMENTS
Ferro-Alloy Resources Limited
Company Registration Number 63449
Registered Office Maison Allaire
Smith Street
St Peter Port
Guernsey
GY1 2NG
Directors Sir Mick Davis
Nicholas Bridgen
Andrey Kuznetsov
William Callewaert
Christopher Thomas
Petrus Nienaber
James Turian
Corporate Brokers
Shore Capital Stockbrokers Limited
57 St James’s Street, Cassini House
London, SW1A 1LD
Panmure Liberum Limited
Ropemaker Place, Level 12
25 Ropemaker Street
London, EC2Y 9LY
Auditors Crowe U.K. LLP
55 Ludgate Hill
London, EC4M 7JW
Registrar Computershare Investor Services (Guernsey) Limited
1
st
Floor, Tudor House
Le Bordage
St Peter Port
Guernsey, GY1 1DB
Financial Press Relations and Investor
Relations
BlytheRay Limited
73 Watling Street
London, EC4M 9BJ
Company Information
Ferro-Alloy Resources Limited
Maison Allaire
Smith Street
St Peter Port
Guernsey
GY1 2NG
www.ferro-alloy.com
Ferro-Alloy Resources Limited Annual Report 2025