Cobre Sales Update and Cash Management

Strategic Minerals plc (AIM: SML; USOTC: SMCDY), a profitable producing mineral company, is pleased to provide the following update on Cobre clients and corporate cash management.

Highlights

• Additional new client added with expected volume of circa 5,000-7,000 tons pa.
• Existing major client's payments commenced in line with tonnage collected.
• Expected 2024 revenues, incorporating the new and major client, to exceed US $3.5m.
• Short-term working capital funding facility undertaken.

Cobre Sales

In mid-January 2024, the new major client (as announced in the RNS of 19 January) began collecting tonnage from the mine gate at a rate consistent with its 30,000-ton 2024 purchase order. In line with this, payments from the major client have commenced with a fourteen-day billing cycle.

Early February has seen the addition of a new client expected to take between 5,000 to 7,000 tons pa. Unlike the major client's arrangements, this is on a take and pay basis without a purchase order. Discussions also continue with another potential new client that is seeking large volume shipments. However, recent arrangements with the major client and the additional new client may impact our capacity to fulfil a large order.

Given the substantial increase in expected sales, the Company anticipates that the 2024 Cobre sales volumes will be over 50,000 tons (17,965 tons in 2023) with revenues expected to exceed US $3.5m (US $1.6m in 2023).

Cash Management

Given the substantial reduction in sales during 2023, the Company maintained operations, including project development, through creditor management and from the Board's election to take substantially lower cash payments.

Considering future sales volumes, and the elongated nature of creditor balances, the Company has entered into short-term financing facilities totalling AUD $100,000, with an individual investor. The facilities comprise AUD $50,000 maturing early May 2024 and AUD $50,000 maturing early October 2024. These unsecured loans have been undertaken through the Company's 100% owned subsidiary Ebony Iron Pty Ltd. The weighted average interest rate on the financing is c19% pa and includes the grant of 10,000,000 warrants over new ordinary shares of 0.1 pence each in the Company with an exercise price of 0.5p maturing 31 December 2025 (to be issued before 1 March 2024). No funds raised under these facilities will be applied to balances outstanding to the Directors or CFO.

Commenting, John Peters, Managing Director of Strategic Minerals, said:

"Encouraging sales trends at our Cobre operation have continued with the addition of a further new client, amid a clearly positive backdrop for the renewed demand for magnetite. There may yet be scope to further augment the existing sales expectations, either during 2024 or beyond.

"The Company remains focused on cash flow management that seeks to avoid the need for a dilutive capital raise at the Company level and we are concentrating on joint venture and potential grant funding to move development projects forward.

"The Leigh Creek Copper Mine is currently subject to potential interest from a new group who are based in the same region as the project and have access to sufficient funds to get the project into operations. Discussions are ongoing to explore how the Company may collaborate with this group in moving the project forward. Meanwhile, the team at Cornwall Resources continues to advance the project on several fronts, including progressing its application for grant funding from the Shared Prosperity Fund and the enabling works for an associated 2024 work program, relogging and sampling of existing core from previous drilling, and negotiations to expand CRL's mineral rights footprint in Cornwall.

"At present, we anticipate an active period of news flow across all projects during Q1 2024 and beyond."