Critical Metals Corp.

Critical Metals Corp. is a mining exploration and evaluation company focused on critical metals and minerals, aiming to produce strategic products essential for electrification and next-generation technologies in Europe and its Western partners. The company's primary strategy involves acquiring, exploring, and developing unique and permitted critical metals mining assets that are expected to benefit from regulatory tailwinds in Europe and North America, as well as long-term secular trends in environmental, commercial, and government applications. The company operates with a holding company structure, incorporated in the British Virgin Islands, and conducts its operations through subsidiaries ¹.

The company's core business model is centered on the exploration and evaluation of mineral properties with the intention of locating economic deposits of Heavy Rare Earth Elements (HREEs) and other critical minerals. It generates revenue through the potential future extraction and sale of these minerals, including lithium hydroxide and rare earths, and their byproducts. The primary customer segments are expected to be civilian and military off-take customers, particularly in the specialty magnets, aircraft avionics, missile guidance systems, drone components, other advanced weapons systems, and electric vehicle industries ². The company has a long-term Offtake Agreement with BMW for battery-grade lithium hydroxide, conditioned on the successful start of commercial production at the Wolfsberg Project and full product qualification and certification ³. Additionally, it has a non-binding letter of intent with Ucore Rare Metals Inc. for up to 10,000 metric tons of rare earth concentrate from the Tanbreez Project, representing approximately 10% of the project's initial projected production ⁴.

The company's main efforts are focused on two foundational assets: the Tanbreez Project in Southern Greenland and the Wolfsberg Project in Carinthia, Austria. The Tanbreez Project is a permitted, globally significant critical minerals asset, expected to supply HREEs to customers in the western hemisphere for next-generation commercial products and defense industry demand. It is notable for its high concentration of HREEs, expected to be greater than 27% ⁵ of Total Rare Earth Oxides (TREO), and extremely low levels of uranium and thorium, making it environmentally and politically viable. The project covers an area of 1,800 hectares ⁶, with an outcropping ore body (Kakortokite) covering 8 x 5 kilometers and approximately 400m thick ⁷. The Tanbreez Project was granted an exploitation license by the Greenland Government in 2020 ⁸ for an initial 500,000 tonnes per annum ⁹. The Preliminary Economic Assessment (PEA) for Tanbreez, issued on March 31, 2025, projects a Net Present Value (NPV) of approximately US$3 billion ¹⁰ (ranging from US$2.8 Billion to US$3.6 Billion ¹¹ at discount rates of 15% and 12.5% respectively, before tax) with an internal rate of return of approximately 180% ¹². The initial Mineral Resource Estimate for the PEA is 44.97 million metric tons ¹³ of rare earth materials (indicated and inferred resources), representing approximately 1% ¹⁴ of the 4.7 billion metric ton ¹⁵ host rock. Planned initial production is approximately 85,000 tonnes per annum (tpa) ¹⁶ of rare earth elements, scalable to approximately 425,000 tpa ¹⁷. Recent drilling in December 2024 discovered high-grade zones, including gallium concentrations up to 147 ppm Ga2O3 ¹⁸ in Area G.

The Wolfsberg Project in Austria comprises 54 exploration licenses covering a total area of 1,133 hectares ¹⁹ and a mining license over 20 mining areas occupying 86.7 hectares ²⁰. The project is strategically located near planned giga factories and major transportation infrastructure in Europe. The mineral resource estimate for the Wolfsberg Project, as of June 30, 2025, stands at a combined Measured and Indicated Resource of 9.7 Mt ²¹ at 1.03% Li2O ²² and an Inferred Resource of 3.1 Mt ²³ at 0.90% Li2O ²⁴, with a 0.2% Li2O cut-off and 0.5 meter thickness cut-off ²⁵. The book carrying value of the Wolfsberg Project was USD$39.7 million ²⁶ as of June 30, 2025. The company also holds a 20% interest in the Weinebene and Eastern Alps Lithium Projects ²⁷ in southern Austria, which are considered complementary to the Wolfsberg Project.

For the fiscal year ended June 30, 2025, Critical Metals Corp. reported total assets of $171.7 million ²⁸ and total liabilities of $79.8 million ²⁹. The company incurred a net loss after income tax of $51.9 million ³⁰ for the year ended June 30, 2025, compared to a net loss of $139.4 million ³¹ for the year ended June 30, 2024. Cash and cash equivalents at year-end were $7,297,328 ³², with net cash outflows from operating activities of $14.5 million ³³. Total equity as of June 30, 2025, was $91.9 million ³⁴, a significant increase from ($11.1 million) ³⁵ as of June 30, 2024, primarily due to the issue of securities.

Year-over-year comparisons show significant shifts in financial performance. Other income increased by $443 thousand ³⁶, or 376% ³⁷, to $560 thousand ³⁸ in 2025. Foreign exchange shifted from a $42 thousand ³⁹ gain in 2024 to a $1,183 thousand ⁴⁰ loss in 2025. Consultants expenses increased by $10,955 thousand ⁴¹, or 792% ⁴², to $12,338 thousand ⁴³. Directors fees increased by $1,254 thousand ⁴⁴, or 916% ⁴⁵, to $1,391 thousand ⁴⁶. Share-based payments surged by $29,959 thousand ⁴⁷, or 4,926% ⁴⁸, to $30,566,894 ⁴⁹. Finance costs decreased by $29,363 thousand ⁵⁰, or 98% ⁵¹, to $466 thousand ⁵² in 2025, primarily due to the initial recognition of financial instruments in 2024. Listing expenses, which were $76.0 million ⁵³ in 2024, were nil in 2025. The company also reported a gain on fair value of warrants of $50 thousand ⁵⁴ in 2025, compared to a loss of $20,623 thousand ⁵⁵ in 2024.

Significant operational developments during the period include the acquisition of a 42% interest ⁵⁶ in the Tanbreez Project by July 23, 2024, through a cash payment of $5 million ⁵⁷ and the issuance of approximately 8.4 million ⁵⁸ ordinary shares to Rimbal Pty Ltd. The company commenced a 2000-meter resource diamond drilling program ⁵⁹ at the Tanbreez Project in July 2025 to increase the mineral resource estimate. An extension to the Tanbreez Project's exploitation license was granted on October 15, 2024, extending deadlines to 2028 ⁶⁰. The company also entered into a Shareholders Agreement with Obeikan Investment Group to form a joint venture for the development and construction of a lithium hydroxide processing plant in Saudi Arabia, which is expected to reduce the company's costs and deliver savings in operating and capital expenditures related to the Wolfsberg Project ⁶¹.

Critical Metals Corp. has not issued formal revenue, margin, or EPS guidance for the upcoming period. However, the company's financial results and liquidity needs are expected to vary depending on the timing of several key factors, including the engagement of key consultants and suppliers, the completion of definitive feasibility studies (DFSs), and obtaining and renewing applicable permits ⁶².

The company anticipates materially increasing its capital and operating expenditures in connection with ongoing activities. This includes hiring additional personnel, continuing work on the DFS for the Wolfsberg Project, conducting geological, geochemical, engineering studies, Environmental Impact Assessment (EIA), and Socio-Economic Studies for the Tanbreez Project, and preparing the Regulation SK-1300 report for Tanbreez. Furthermore, the company plans to commence exploration activities in Zone 2 of the Wolfsberg Project and at the Tanbreez Project, and enter into financing and project financing arrangements for the further exploration and future development of both projects ⁶³.

A major growth area is the Tanbreez Project, where the company expects to complete a definitive feasibility study by the end of 2025 ⁶⁴. The project is licensed for 500,000 metric tons per year ⁶⁵ of mining and processing operations. The PEA for Tanbreez projects an initial production of approximately 85,000 tpa ⁶⁶ of rare earth elements, scalable to approximately 425,000 tpa ⁶⁷ with modular expansion. The company aims to become a long-term supplier to the United States' and European Union's critical mineral and defense sectors, leveraging its position as one of the few Western-aligned HREE sources ⁶⁸. The discovery of gallium at 147ppm Gallium Oxide Ga2O3 ⁶⁹ in Area G of the Tanbreez Project presents a valuable opportunity, with the company planning to investigate its potential as a viable by-product and expecting to publish confirming assay results from concentrates in October 2025 ⁷⁰.

Another significant growth area is the Wolfsberg Project, where the company aims to commence spodumene production in 2028 or 2029 ⁷¹, subject to funding, relevant approvals by the Austrian government, and the recovery of commodity prices for lithium and lithium products. The company expects to complete another DFS for spodumene production at Wolfsberg, subject to additional funding, which is expected to be compatible with both Regulation S-K 1300 and the JORC Code ⁷². The strategic collaboration with Obeikan Investment Group to build and operate a lithium hydroxide plant in Saudi Arabia is expected to reduce the company's cost to build and operate such a plant independently, and once operational, significantly reduce energy costs and deliver savings in operating and capital expenditures related to the Wolfsberg Project ⁷³.

The company's margin trajectory and cost structure evolution are influenced by its strategic collaboration with Obeikan, which is expected to reduce future costs for building and operating a lithium hydroxide plant and deliver savings in operating and capital expenditures related to the Wolfsberg Project ⁷⁴. The company may also take actions such as monitoring operating expenses, limiting headcount, and implementing other measures to minimize inflationary pressures and avoid unnecessary costs, particularly before the Wolfsberg Project begins production ⁷⁵.

Regarding capital allocation, the company received approximately US$24.6 million ⁷⁶ in aggregate gross proceeds from a private placement of ordinary shares and warrants on February 7, 2025. These funds will be used for developing plans for both the Tanbreez Project and Wolfsberg Project, and for general corporate and working capital purposes ⁷⁷. The company also received $2 million ⁷⁸ from the exercise of Private Warrants held by the Empery Funds on May 27, 2025. Additionally, the U.S. Export-Import Bank issued a non-binding letter of interest on June 16, 2025, contemplating up to $120 million ⁷⁹ in funding for the development of the Tanbreez Project ⁸⁰. The company does not anticipate declaring any cash dividends in the foreseeable future, intending to retain future earnings to finance operations and business expansion ⁸¹.

The company explicitly flagged several structural headwinds and execution risks. Its current liquidity resources raise substantial doubt about its ability to continue as a going concern unless additional capital is raised ⁸². The Tanbreez and Wolfsberg Projects are at the exploration and evaluation stage, with no guarantees of subsequent development into operating mines or commercial extraction of mineral deposits ⁸³. Long-term success depends on negotiating and entering into binding offtake or sales agreements on commercially viable terms, which may not occur ⁸⁴. The company is substantially dependent on the continued growth of demand for specialty magnets, advanced weapons systems, and the electric vehicle industry, which are subject to numerous external factors and volatility ⁸⁵. Changes in demand signals, macroeconomic trends, or technology preferences for particular types of permanent magnets or substitute products could adversely affect demand for HREEs and/or lithium compounds ⁸⁶. The company's future revenues are largely dependent on long-term market prices for HREEs, lithium, and associated byproducts remaining higher than realized production costs ⁸⁷.

Critical Metals Corp. faces substantial risks, including significant liquidity concerns that raise substantial doubt about its ability to continue as a going concern unless additional capital is raised ⁸⁸. The company operates in the mining exploration and evaluation industry, with both the Tanbreez and Wolfsberg Projects at early stages, offering no guarantees of successful development into profitable mines or commercial extraction of mineral deposits ⁸⁹. The long-term success is contingent on securing binding offtake or sales agreements, which are not assured, and the company currently has no revenue or definitive off-take or sales agreements in place other than the lithium Offtake Agreement with BMW ⁹⁰. The company is heavily reliant on the continued growth of demand for specialty magnets, advanced weapons systems, and the electric vehicle industry, which are susceptible to external factors like market volatility, supply chain disruptions, foreign government interventions, environmental impacts, high production costs, inflation, and anti-mining movements ⁹¹. Fluctuations in commodity prices for HREEs, lithium, and byproducts, driven by international economic and political trends, inflation, currency exchange, and new production from competitors, could adversely affect the economic viability of its projects ⁹². The company's mineral resource estimates are inherently imprecise and may change significantly, potentially reducing estimated resources or rendering them uneconomic ⁹³. The mining industry is highly competitive, with larger, more established companies possessing greater financial resources and lower cost structures ⁹⁴. Operational risks include environmental hazards, industrial accidents, seismic events, and potential regulatory fines or work stoppages ⁹⁵. The company is exposed to possible litigation risks, including mining permit disputes, environmental claims, and a pending arbitration with GEM Investor seeking a cash payment of $3,500,000 ⁹⁶ and ordinary shares valued at $27,200,000 ⁹⁷, plus interest ⁹⁸. Cybersecurity risks, including unauthorized access, data theft, and system disruptions, could impair business operations and lead to financial losses ⁹⁹. Macroeconomic slowdowns, recessions, geopolitical instability (such as the Russian-Ukraine conflict and Middle East conflicts), high interest rates, and force majeure events (e.g., labor unrest, extreme weather, pandemics) may negatively impact financial results and operations ¹⁰⁰. The company also faces opposition from anti-mining organizations, which could disrupt or delay projects ¹⁰¹. As a U.S. public company, it incurs significant increased expenses and administrative burdens, and its current management has limited experience operating a U.S. public company ¹⁰². The company has identified six significant deficiencies in its internal control over financial reporting, including segregation of duties, related party transactions, accounting for accounts payable and accrued expenses, income tax provision, complex financial instruments, and cybersecurity programs ¹⁰³.

Management's message to shareholders emphasizes the company's strategic focus as a mining exploration and evaluation company dedicated to critical metals and minerals, aiming to produce strategic products for electrification and next-generation technologies for Europe and its Western partners. The overall tone highlights the company's primary strategy to acquire, explore, and develop unique and permitted critical metals mining assets that are expected to benefit from robust regulatory tailwinds in both Europe and North America, and long-term secular trends in environmental, commercial, and government applications. Management explicitly states that its foundational assets are the Wolfsberg lithium assets in Austria and the Tanbreez rare earths deposit in Greenland. They articulate a strategy involving the development of a low-cost, highly sustainable source of lithium hydroxide from spodumene concentrate to provide European battery and EV manufacturers with improved supply continuity, reduced dependence on Chinese manufacturers, and assistance in meeting environmental commitments. Additionally, the company expects to focus efforts on rare earths and critical metals and minerals to produce strategic products essential for a transition to sustainable low carbon emission technologies for Europe and its western world partners, believing this approach will position them as one of the most sustainable, cost-effective, and strategic minerals suppliers globally, aiding potential customers in achieving their environmental, social, and governance goals. Management projects the completion of a definitive feasibility study for the Tanbreez Project by the end of 2025 ¹⁰⁴ and anticipates commencing spodumene production at the Wolfsberg Project in 2028 or 2029 ¹⁰⁵, subject to funding and approvals.