Global Atomic : Management's Discussion & Analysis of Financial Condition & Results of Operations for the Three Months Ended March 31, 2025
GLO.TO
Published on 05/13/2025 at 19:06
Table of Contents
OUTLOOK 3
Dasa Uranium Project 3
Uranium Prices 3
Turkish Zinc Joint-Venture 4
HIGHLIGHTS 4
Dasa Uranium Project - Mine Development 4
Dasa Uranium Project - Plant Construction 4
Dasa Uranium Project - Niger Government Support 5
Turkish Zinc Joint Venture 5
Corporate 5
BACKGROUND 5
URANIUM BUSINESS 5
TURKISH ZINC EAFD OPERATIONS 10
COMPARATIVE RESULTS 13
SELECTED QUARTERLY FINANCIAL INFORMATION 14
LIQUIDITY AND FINANCIAL POSITION 15
CAPITAL MANAGEMENT 15
FINANCIAL RISK FACTORS 15
RELATED PARTY TRANSACTIONS 15
OFF-BALANCE SHEET TRANSACTIONS 15
MATERIAL ACCOUNTING POLICY INFORMATION AND CRITICAL ACCOUNTING ESTIMATES & JUDGEMENTS 16
CHANGES IN MATERIAL ACCOUNTING POLICY INFORMATION 16
DISCLOSURE OF INTERNAL CONTROLS 16
RISKS AND UNCERTAINTIES 16
OUTSTANDING SHARE DATA 17
MANAGEMENT'S RESPONSIBILITY FOR FINANCIAL INFORMATION 17
QUALIFIED PERSON 17
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS 17
The following discussion of the results of operations and financial condition of Global Atomic Corporation ("Global Atomic" or the "Company") prepared as of May 13, 2025 summarizes management's review of the factors that affected the Company's financial and operating performance for the three months ended March 31, 2025, and the factors reasonably expected to impact on future operations and results ("Management's Discussion and Analysis of Financial Condition and Results of Operations" or "MD&A").
This MD&A is intended to supplement and complement the Company's unaudited condensed interim consolidated financial statements as at and for the three months ended March 31, 2025 ("Financial Statements") and the notes thereto, which were prepared in accordance with IFRS Accounting Standards ("IFRS").
Certain information and discussion included in this MD&A constitute forward-looking information, which should be read in consideration of the cautionary notes contained in the section "Forward-Looking Statements" at the end of this MD&A.
Further information about the Company and its operations can be obtained from the offices of the Company, at https://www.globalatomiccorp.com or from https://www.sedarplus.ca.
Dasa Uranium Project
The Company is actively engaged with a U.S. Development Bank to establish a debt facility to finance 60% of Dasa's development costs. The Bank has confirmed that their internal process to advance the approval of a debt facility for our Dasa Project is proceeding and is expected to occur during Q2 2025. Once approved by the Credit Committee, the Dasa Project loan will then move to the Investment Committee and the Board of Directors for final approval.
While working toward completion of the debt facility, the Company has also been involved in discussions with parties regarding a minority project level investment, representing potential alternatives to finance the Dasa Project. Any investment would be based on the intrinsic value of the Dasa Project as per the Company's most current Feasibility Study plus investments made by the Company to advance the Project since that date, and not the current price of the Company's shares.
The Company is also in discussions with a well-known uranium industry group regarding a limited, non-equity investment.
These potential transactions could eliminate the need for a near term equity financing, allowing the Bank and any other project level investors sufficient time to complete their approval processes and commit funds for the Dasa Project.
The Company continues to manage its spending to provide additional time to finalize project financing on terms best suited to the Company and its shareholders, without coming back to the equity market in the near term.
Uranium Prices
During Q1 2025, spot Uranium prices traded down from near $75/pound U3O8 to slightly below $65/pound U3O8, still well above Dasa's AISC of $35.70/pound, as per the 2024 Feasibility Study.
Since quarter end, spot uranium prices have risen to approximately $70 per pound U3O8.
Long-term contract prices have remained steady at $80 per pound U3O8.
The fundamentals and dynamics that affect the spot and long-term prices are different. In the spot market, the current price is the result of several factors including utilities waiting to assess the ramifications of U.S. imposed tariffs, financial players stepping in and out of the spot market and the outsized effect on often small volume trades by traders on prices.
The long-term price is the basis of pricing for multi-year utility off-take agreements and features less volatility than the thinner, more speculative spot market.
Globally, the uranium industry continues to experience greater acceptance and expansion as a critical element in the global, carbon free, energy supply.
The longer-term outlook for both the spot and long-term market is expected to be robust as demand outstrips supply due to unprecedented growth in the number of nuclear reactors, including small nuclear reactors (SMRs) as well as growing demand for energy to power data centers and artificial intelligence ("AI") systems.
Turkish Zinc Joint-Venture
The Company anticipates its Turkish JV will perform strongly in 2025 as area steel mill activity has returned to pre-Covid levels.
Better availability of this operation's primary raw material, electric arc furnace dust (EAFD), from area steel mills, and lower input costs are expected to contribute to profitable operations in 2025.
Zinc prices, like the price of many critical minerals, are expected to be volatile during the year amid global tariff talks.
Dasa Uranium Project - Mine Development
Underground development, underway since November 2022, has now reached the ore zone with development waste being hauled to surface.
Waste development tonnes brought to surface include medium grade (3,000 to 5,000 ppm), low grade (1,300 to 3,000 ppm) and mineralized waste (240 to 1,300 ppm), all of which can be processed during the commissioning of the plant.
Recently, paving of the underground ramp was completed to ensure durability as this ramp will be the primary access by the mining team and the haul route for ore delivery to surface for stockpiling and processing.
Ramping and underground level development will continue to facilitate stope access on five levels in time for commissioning of the processing plant.
Underground electrical services and water management infrastructure upgrades are also underway.
The Fresh Air Raise and Return Air Raise have been completed and fans installed to provide greater ventilation required as mine development is extended.
On May 6, 2025, the Dasa Mine, operated by SOMIDA and overseen by Global Atomic Corporation, achieved and celebrated 1,000 days with no Lost Time Injury ("LTI").
Dasa Uranium Project - Plant Construction
Procurement of long-lead equipment is complete. Manufacturing of many of these components has been completed and have been delivered to the Dasa site.
Our Engineering, Procurement and Contract Management ("EPCM") contractors are completing the final detailed engineering and ordering the remaining components for the Processing Plant.
The Company continued earthworks in Q1 2025 to prepare the site for construction of the Processing Plant. To date, multi-tiered earthworks for the acid plant are complete and have been handed over to the civil works contractors to prepare foundations prior to equipment installation.
The Company is completing additional housing for employees and construction crews including a new 260-person housing facility that includes recreation facilities.
Dasa Uranium Project - Niger Government Support
During a recent trip to Niger, President & CEO Stephen G. Roman met with Mines Minister Abarchi and also
U.S. Ambassador Kathleen FitzGibbon both of whom continue to strongly support Global Atomic, SOMIDA and the Dasa Project.
Turkish Zinc Joint Venture
The Turkish JV processed 18,608 tonnes EAFD and sold 6.5 million pounds of zinc in concentrate in Q1 2025.
The average monthly LME zinc price in Q1 2025 was US$1.29/pound compared to US$1.11/pound in the same quarter of 2024.
The Company's share of EBITDA was $1.5 million in Q1 2025 ($0.7 million in Q1 2024) and the Company's equity share of net income was $0.3 million ($0.3 million in Q1 2024).
The cash balance of the Turkish JV was US$0.4 million at the end of Q1 2025 (end of 2024 - US$4.4 million).
The revolving credit facility of the Turkish JV was US$3.8 million at the end of Q1 2025 (Global Atomic share - US$1.9 million) down from US$6.5 million at the end of 2024 (Global Atomic share - US$3.2 million).
Corporate
On January 31, 2025, Global Atomic closed a private placement for gross proceeds of $35.6 million at a price of $0.80 per Unit consisting of one common share and one common share warrant. Net proceeds from this financing are being used for development of the Dasa Project and general working capital purposes.
During Q1 2025, Global Atomic received management fees and monthly sales commissions from the Turkish JV ($0.3 million in Q1 2025 compared to $0.3 million in Q1 2024).
The Company's cash balance as of March 31, 2025 was $21.4 million.
Global Atomic is a reporting issuer under applicable securities legislation in the provinces of Alberta, British Columbia and Ontario and trades under the symbol "GLO" on the Toronto Stock Exchange (the "TSX"), under the symbol "GLATF" on the Over-The-Counter Market (the "OTC:QX") in the United States of America and under the symbol "G12" on the Frankfurt Stock Exchange.
Global Atomic is headquartered in Toronto, Canada and is incorporated under the laws of the Province of Ontario. Global Atomic and its subsidiaries have two principal lines of business:
the processing of electric arc furnace dust ("EAFD") obtained from steel companies through a Waelz kiln to recover zinc and produce a high-grade zinc concentrate in Türkiye for sale to smelters.
the acquisition, exploration and development of uranium properties, with the Dasa Project currently under development in Niger.
The Company's Uranium Business operates through a wholly owned subsidiary, GAFC, which holds an 80% interest in SOMIDA and a wholly owned exploration company, GUNI. Exploration permits previously held by GUNI have expired and GUNI has made application for exploration permits proximal to the Dasa Mine.
SOMIDA was incorporated on August 11, 2022 pursuant to the laws of the Republic of Niger and the Adrar Emoles 3 Mining Agreement signed by GAFC and the Republic of Niger on September 25, 2007 in respect of Adrar Emoles 3. The Republic of Niger received a 10% free carried interest in SOMIDA and exercised its right to subscribe for an additional 10%, resulting in the Government of Niger holding 20% of the total ownership of SOMIDA. Under the terms
of the GAFC Mining Agreement, the Republic of Niger is obligated to fund its proportional share of capital costs and operating deficits for the Dasa Project in order to maintain its additional 10% interest. The Republic of Niger has no further right or option to increase its ownership in SOMIDA.
In accordance with the Mining Agreement, the historic exploration costs incurred on the Adrar Emoles 3 Exploration Permit prior to December 31, 2021 of US$54.9 million were transferred to SOMIDA and are recoverable by GAFC from SOMIDA. Additionally, Global Atomic has been funding 10% of the development expenditures on behalf of the Republic of Niger. Such funding has accumulated to US$13.2 million plus interest and is recoverable from the Republic of Niger.
Resources
Since 2011, GAFC's exploration activities have been primarily focused on the Dasa deposit. In 2018, GAFC began a drill program at an area identified as the "Flank Zone" to assess the potential for near-surface high-grade mineralization, as well as testing strike extensions of the deeper mineralization at depth. The Company was successful with both programs. The drilling identified significant amounts of high-grade mineralization in the Flank Zone and in several new zones along strike and down dip. This information guided the location of the 16,000-meter infill drilling program in 2021 and 2022 when the Company drilled a further 28 diamond drill holes for a total of 16,368 meters, targeting areas of Inferred Resources, so they could be upgraded to the Indicated category. Using this new data, AMC Consultants, ("AMC"), was engaged to prepare an updated Mineral Resource Estimate ("2023 MRE") which they reported on with an effective date of May 12, 2023.
Category
Tonnes
eU3O8
Contained Uranium Metal
Mt
ppm
Mlb
Indicated
10.1
4,913
109.3
Inferred
4.5
5,243
51.4
The following resource schematic shows the Indicated and Inferred resources as estimated in the MRE. Indicated Resources are shown in purple and Inferred Resources are shown in yellow.
Reserves
Following the updated MRE, the Company has updated the previous Phase 1 Feasibility Study. The updated Feasibility Study ("2024 Feasibility Study") was reported with an effective date of February 28, 2024 and filed on SEDAR+ on March 27, 2024.
The 2024 Feasibility Study estimated the following Mineral Reserves.
Mineral Reserve Category
RoM (Mt)
eU308
(ppm)
U308
(t)
U308
(Million lbs)
Proven Mineral Reserve
-
-
-
-
Probable Mineral Reserve
8.05
4,113
33,097
73.0
2024 Feasibility Study Results.
The FS was completed using a uranium price of US$75/pound U3O8. Key economic and production statistics are as follows:
Summary Project Metrics @ US$75/lb U3O8
Project Economics (USD)
After-tax NPV (8% discount rate)
US$M
$917
After-tax IRR
%
57%
Cash flow (before capex & taxes)
US$M
$2,948
Undiscounted after-tax cash flow (net of capex)
US$M
$1,839
After-tax payback period from Jan 2024
Years
4.2
After-tax payback period from start-up
Years
2.2
Unit Operating Costs
Cash cost before royalties
$/lb U3O8
$25.62
LOM average cash cost(1)
$/lb U3O8
$30.73
AISC(2)
$/lb U3O8
$35.70
Production Profile
Mine Life
Years
23.75
Total tonnes of mineralized material processed
M Tonnes
8.05
Mill processing rate
Tonnes/day
1,000
Mill Head Grade
ppm
4,113
Overall Mill Recovery (3)
%
93.4%
Total Lbs U3O8 processed
Mlbs
73.0
Total Lbs U3O8 recovered
Mlbs
68.1
Average annual Lbs U3O8 production
Mlbs
2.9
Peak annual Lbs U3O8 production
Mlbs
4.9
Cash costs include all mining, processing, site G&A, and royalty costs, as well as Niamey head office and other off-site costs.
All-in sustaining costs ("AISC") include cash costs plus capital expenditures forecast after the start of commercial production.
Ramp up of the mill is assumed to take 11 months, during which recoveries increase. Once stable production levels have been achieved at the end of 11 months, the recovery rate stabilizes at 94.15%.
The economic analysis for the FS was done via a discounted cash flow ("DCF") model based on the mining inventory from the FS Mine Plan at a price of US$75 per pound of U3O8. Sensitivity analysis was carried out at price intervals from US$60 per pound to US$105 per pound, as shown in the table below. The DCF includes an assessment of the current tax regime and royalty requirements in Niger. Net present value ("NPV") figures are calculated using a range of discount rates as shown. The discount rate used for the base-case analysis is 8% ("NPV8"). NPV has been calculated by discounting net cash flows to the start of operations, January 1, 2026, and deducting undiscounted remaining initial capital costs therefrom.
Economic sensitivity with varying uranium prices (USD)
Uranium price (per pound)
$60/lb
$75/lb
$90/lb
$105/lb
Before-tax NPV @ 8%
$656 M
$1,122 M
$1,572 M
$2,022 M
After-tax NPV @ 8%
$551 M
$917 M
$1,269 M
$1,621 M
After-tax IRR
38.2%
57.0%
74.8%
92.9%
Optimization Potential
Throughput Optimization
The FS was based on a plant throughput of 1,000 tonnes per day (t/d) or 365,000 tonnes per annum (t/a). The plant equipment has been designed for 1,200 t/d throughput but the FS assumed plant availability of 86% (1,200 t/d x 86%
= 1,032 t/d). The Arlit processing plants achieve 92% availability, by comparison. If SOMIDA has a similar experience, throughput would increase to about 1,104 t/d (1,200 t/d x 92% = 1,104 t/d). The plant layout has been optimised to enable the addition of more processing lines in the future. Much of the equipment has been over-sized by 20%, so minimal capital costs would be required to achieve throughput of 1,325 t/d (1,200 t/d x 1.2 x .92 = 1,325 t/d). Fixed mining, processing and site costs are significant, so increases in throughput would have a significant impact on reducing unit costs.
Reserve Expansion
Enhancement of throughput and possible mill expansions will be investigated to improve and maintain the processing plant output. Achieving increased throughput will significantly lower the unit operating costs over time. Additional infill
drilling is also expected to upgrade Inferred Resources to the Indicated Resource category so these can be included in subsequent mine plans.
As shown in the Mineral Resource table above the tonnes and grades of the Inferred Resources are significant, estimated to have a contained uranium content potential of an additional 50%. The Company expects to have good success in conversion of these resources to Indicated Resources, as well as expanding the overall resource envelope.
Capital Costs
The following table summarizes the actual capital expenditures and estimated cost to complete the Dasa Project as at March 31, 2025:
Description
PROJECT COSTS (US$ millions)
Incurred to
March 31, 2025
Balance Remaining
Total
Processing plant
23.3
118.2
141.5
Infrastructure
17.2
28.2
45.4
Owners project cost
2.7
5.5
8.2
EPCM
10.4
7.3
17.7
Mining
64.3
39.6
103.9
Site and Niamey costs
22.3
31.1
53.4
Contingency
-
22.7
22.7
Total Direct capital costs (1)
$140.2
$252.6
$392.8
Total direct capital costs excludes working capital, corporate costs and financing costs.
Mine Development
Underground development, underway since November 2022, has now reached the ore zone with waste development tonnes now being hauled to surface. Waste development tonnes brought to surface include medium grade (3,000 to 5,000 ppm), low grade (1,300 to 3,000 ppm) and mineralized waste (240 to 1,300 ppm), all of which can be processed during the commissioning of the plant. Recently, paving of the underground ramp was completed to ensure durability as this ramp will be the primary access by the mining team and the haul route for ore delivery to surface for stockpiling and processing. Ramping and underground level development will continue to facilitate stope access (mining) on five levels in time for commissioning of the processing plant. Underground electrical services and water management infrastructure upgrades are also underway. As of the date hereof, the Dasa Mine, operated by SOMIDA and overseen by Global Atomic Corporation, has achieved 1000 days with no Lost Time Injury ("LTI").
Plant Construction
The Company continued earthworks in Q1 2025 to prepare the site for construction of the Dasa processing plant. To date, multi-tiered earthworks for the acid plant are complete and have been handed over to the civil works contractors to prepare the foundations. The Company is preparing the mine camp for additional housing for employees and construction crews and an additional 260-person housing facility is close to completion. Procurement of long-lead equipment is complete, with many items at manufacturing completion. Certain critical items like the SAG Mill, Crusher and Acid Plant are now at the Dasa site. Our EPCM contractors are completing the final detailed engineering and ordering the remaining components for the Processing Plant.
Offtake Agreements
In 2023, the Company executed three uranium offtake agreements for sales to North American utilities. These agreements total between 6.9 and 8.8 million pounds U3O8 over 6 years beginning in 2026. The higher amount assumes
the exercise of options available to the buyers. In 2024 the Company signed an offtake agreement with a Europe-based nuclear power utility to supply 260,000 pounds U3O8 per year for three years beginning in 2026. This is the fourth such agreement signed by Company.
Niger Political Situation
On July 26, 2023, the military in Niger placed the President under house arrest and assumed day-to-day operation of the Government. This move was widely condemned by the international community. The Economic Community of West African States ('ECOWAS') imposed sanctions on Niger, resulting in the closure of Niger's borders and air space. Many ECOWAS countries did not support the border closures imposed by ECOWAS and most borders reopened after a short period of time except Nigeria and Benin. On February 24, 2024, ECOWAS removed all sanctions. Although ECOWAS no longer restricts border crossings, the Niger-Benin border remains closed from the Niger side.
The Niger government remains supportive of Global Atomic, SOMIDA and the Dasa Project. A site visit on May 3, 2024, by Mines Minister Abarchi noted that the Dasa Project, is strongly supported by the Niger Government, and is progressing well with high morale and effective teamwork across all areas including mining, construction, and community engagement.
Further, on August 15, 2024, President Tiani and the Council of Ministers confirmed their support for the Company and the Dasa Project. In November 2024, the Government of Niger reaffirmed its strong support for the Dasa Project through direct engagement and facilitation of key operational and logistical matters by forming a dedicated Government Committee, comprised of representatives from all relevant ministries to streamline decision-making related to operations, logistics, and taxation. Logistical constraints, such as border closures, are being actively addressed at the highest levels of government, with alternative shipping routes being secured via Algeria, Nigeria, and Togo/Burkina Faso.
This continued government support ensures that the project will not face regulatory hurdles or material operational delays, limiting the risks due to external geopolitical factors.
The Company's Turkish EAFD business operates through a joint venture with Befesa Zinc S.A.U. ("Befesa"), an industry leading Spanish company that operates a number of Waelz kilns throughout Europe, North America and Asia. On October 27, 2010, Global Atomic and Befesa established a Joint Venture, known as Befesa Silvermet Turkey, S.L. ("BST" or the "Turkish JV") to operate an existing plant and develop the EAFD recycling business in Türkiye through BST's wholly owned subsidiary, Befesa Silvermet Iskenderun Celik Tozu Geri Donusum A.S. ("BSI"), with zinc concentrates being sold through BST's wholly-owned subsidiary, Befesa Silvermet dis Ticaret A.S. ("BSD").
BST is held 51% by Befesa and 49% by Global Atomic. A Shareholders Agreement governs the relationship between the parties. Under the terms of the Shareholders Agreement, management fees and sales commissions are distributed pro rata to Befesa and Global Atomic.
On a monthly basis, sales commissions based on volumes sold are paid by BSD to Befesa Zinc Comercial SAU ("BZC"), a subsidiary of Befesa and distributed to the Company and Befesa based on their proportionate ownership. Management fees based on revenues are paid by BSI on a quarterly basis to BST and similarly distributed to the Company and Befesa. According to the BST Shareholder Agreement, net income earned by BST, less funds needed to fund operations, must be distributed to the Company and Befesa Zinc annually, following the BST annual meeting, which is usually held in the second quarter of the following year.
BST owns and operates a modern EAFD processing plant in Iskenderun, Türkiye. The plant processes EAFD containing 25% to 30% zinc that is obtained from electric arc steel mills, and produces a zinc concentrate grading 65% to 68% zinc that is then sold to zinc smelters.
Global Atomic holds a 49% interest in the Turkish JV and, as such, the investment is accounted for using the equity basis of accounting. Under this basis of accounting, the Company's share of the BST's earnings is shown as a single line in its Consolidated Statements of Income (Loss).
The following table summarizes comparative results for Q1 2025 and 2024 of the Turkish JV at 100%:
Three months ended March 31,
2025
2024
100%
100%
Revenues
$
8,735,678
$
9,508,298
Cost of sales
$
6,042,555
$
8,415,706
Foreign exchange gain
$
339,198
$
240,854
EBITDA (1)
$
3,032,321
$
1,333,446
Management fees and sales commissions
$
624,855
$
767,865
Depreciation
$
327,098
$
552,362
Interest expense
$
209,096
$
564,683
Foreign exchange loss
$
339,902
$
1,143,712
Monetary loss (gain)
$
712,806
$
(1,373,721)
Tax expense (recovery)
$
265,289
$
(1,002,446)
Net income
$
553,275
$
680,991
Global Atomic's equity share
$
271,105
$
333,686
Global Atomic's share of EBITDA
$
1,485,837
$
653,389
EBITDA is a non-IFRS measure, does not have a standardized meaning prescribed by IFRS and may not be comparable to similar terms and measures presented by other issuers. EBITDA comprises earnings before income taxes, interest expense (income), foreign exchange loss (gain) on debt and bank, depreciation, management fees, sales commissions, losses (gains) on sale of property, plant and equipment.
Zinc concentrates are sold to smelters in USA dollars. Because the Turkish Lira is the functional currency of the Turkish operations, sales are converted to Turkish Lira at the date of the sale. When funds are subsequently received, the US dollar receipts are translated to Turkish Lira. The Turkish Lira depreciated in 2023 and 2024, with the result that exchange gains were recognized on sales when converted to Turkish Lira. In calculating EBITDA, these exchange changes related to the functional and reporting currencies are treated as operations related (i.e., above the EBITDA subtotal). Sales are recorded upon receipt at the smelter, which means that recorded sales in any given month generally represent the concentrate from EAFD processed in the prior month. Sales for the three-month ended March 31, 2025, were produced in December 2024 through February 2025.
All the financial statement line items included in the Turkish Zinc JV consolidated statements of income (loss) include the impact of hyperinflation accounting for the three-month period ended March 31, 2025 and 2024. Non-monetary assets and liabilities which are not carried at amounts current at the balance sheet date, and components of shareholders' equity are restated by applying the relevant conversion factors. All items in the statement of income are restated by applying the relevant (monthly) conversion factors.
In Q1 2025, the Turkish JV sold 6.5 million pounds of zinc concentrate compared with 9.3 million pounds sold in the corresponding period last year. Despite lower volume of sales, EBITDA margin increased primarily due to higher average monthly LME zinc price, which increased to US$1.29 per pound in Q1 2025 from US$1.11 per pound in Q1 2024.
The cash balance of the Turkish Zinc JV was US$0.4 million at March 31, 2025 (December 31, 2024 - US$4.4 million).
The local Turkish revolving credit facility balance was US$3.8 million at March 31, 2025 (December 31, 2024 - US$6.5 million) and bears interest at 10%. The Turkish revolving credit facility can be rolled forward.
The loans are denominated in US funds but converted to Turkish Lira for functional currency accounting purposes. For presentation purposes, the equity interests are then converted to Canadian dollars. The foreign exchange loss for the 3 months ended March 31, 2025, related to the Turkish JV debt and cash balances was $0.3 million ($1.1 million in Q1 2024).
The foreign exchange loss is an unrealized loss, and largely relates to the devaluation of the Turkish Lira ("TL") relative to the US$ from 35.3 on December 31, 2024, to 37.9 at March 31, 2025. In economic terms, all revenues are received in US dollars and these will be used to pay down the US denominated debt, so no exchange gains/losses will be realized in US dollar terms. The accounting exchange losses relate to the debt and cash balances are shown below EBITDA as a financing related cost.
For the three months ended March 31, 2025, total net income of the Turkish Zinc JV was $0.6 million. The Company's share of EBITDA was $1.5 million in Q1 2025 ($3 million at 100%). After deduction of management fees, sales commissions and interest expense, depreciation, foreign exchange losses, monetary gain and taxes, the Company's share of net income was $0.3 million for Q1 2025 ($0.6 million at 100%).
The following table summarizes comparative operational metrics of the Iskenderun facility.
Three months ended March 31,
2025
2024
100%
100%
Exchange rate (C$/TL, average)
25.29
22.95
Exchange rate (US$/C$, average)
1.44
1.35
Exchange rate (C$/TL, period-end)
26.39
23.87
Exchange rate (US$/C$, period-end)
1.44
1.36
Average monthly LME zinc price (US$/lb)
1.29
1.11
EAFD processed (DMT)
18,608
19,990
Production (DMT)
6,440
6,251
Shipments (DMT)
4,338
6,477
Shipments (zinc content '000 lb.)
6,464
9,271
In Q1 2025, world steel production decreased by 0.4% over the comparable 2024 period. The impact by region was mixed. In Q1 2025 compared to Q1 2024: Chinese production increased by 0.6%; European Union production decreased by 2.5%; North American production did not change, Turkish production decreased by 3.4%, India production increased by 6.8%.
The impact of the Ukrainian conflict on global steel markets is uncertain, however as exports from Russia and Ukraine have historically accounted for 10% of global steel exports, it is likely a material percentage of this supply will be replaced by increased production in other countries.
The following table summarizes comparative results of operations of the Company:
Three months ended March 31,
(all amounts in C$)
2025
2024
Revenues
$ 286,757
$ 271,463
General and administration
1,777,749
2,199,221
Share of net gain from joint venture
(271,105)
(333,686)
Finance income
(160,650)
(241,631)
Foreign exchange (gain) loss
2,933,523
(3,750,362)
Net income (loss)
$ (3,992,760)
$ 2,397,921
Net income (loss) attributable to:
Shareholders of the Company
(3,893,773)
2,383,178
Non-controlling interests
(98,987)
14,743
Other comprehensive income
$ 2,860,742
$ 685,111
Comprehensive income (loss)
$ (1,132,018)
$ 3,083,032
Comprehensive income (loss) attributable to:
Shareholders of the Company
(1,032,092)
3,047,947
Non-controlling interests
(99,926)
35,085
Basic and diluted net income (loss) per share
($0.01)
$0.01
Basic weighted-average
number of shares outstanding
293,105,017
208,080,080
Diluted weighted-average
number of shares outstanding
293,105,017
213,208,175
March 31,
December 31,
2025
2024
Cash and cash equivalents
$ 21,433,936
$ 18,673,229
Property, plant and equipment
260,720,305
233,611,803
Investment in joint venture
18,946,663
18,114,403
Other assets
3,864,412
3,483,137
Total assets
$ 304,965,316
$ 273,882,572
Total liabilities
$ 24,949,295
$ 26,764,526
Total equity
$ 280,016,021
$ 247,118,046
The condensed interim consolidated financial statements reflect the equity method of accounting for Global Atomic's interest in the Turkish JV. The Company's share of net earnings and net assets are disclosed in the notes to the financial statements.
Revenues include management fees and sales commissions received from the joint venture. These are based on joint venture revenues generated and zinc concentrate tonnes sold.
General and administration costs at the corporate level include general office and management expenses, stock option awards, costs related to maintaining a public listing, professional fees, audit, legal, accounting, tax and consultants' costs, insurance, travel and other miscellaneous office expenses.
Share of net earnings from joint venture represents Global Atomics' equity share of net earnings from the Turkish Zinc JV.
Finance income includes interest earned from the short-term bank deposits. Finance income decreased in 2025, representing lower cash balances on hand.
Foreign exchange loss represents realized and unrealized exchange losses that arise from the translation of foreign currency denominated assets and liabilities to local currency. For the three month ended March 31, 2025, revaluation of US$ relative to the Canadian dollar and West African CFA ("CFA") resulted in $2.9 million foreign exchange loss.
Revenues Net Income (Loss) Net Income (Loss) per share
2025
Q1
286,757
(3,992,760)
(0.01)
2024
Q4
281,020
10,767,816
0.04
Q3
2,306
(6,512,098)
(0.02)
Q2
304,552
1,042,632
0.01
Q1
271,463
2,397,921
0.01
2023
Q4
191,213
(4,335,791)
(0.02)
Q3
165,669
(800,001)
-
Q2
202,273
(6,221,026)
(0.03)
All quarterly values reflect Global Atomic's 49% interest in the Turkish JV using the equity method, with the Company's share of net earnings of the joint venture. The presentation currency is Canadian dollars.
The Company's revenues are based on management fees and sales commissions received from Turkish JV, which in turn, vary from quarter to quarter based on zinc prices and sales volumes.
Net income is primarily impacted by general and administration expenses, foreign exchange gain (loss) and changes in the equity income recorded for the Turkish JV.
Stock-based compensation is granted to management, contractors and directors from time to time, and impacts quarterly results accordingly.
The Company had a working capital surplus of $3.2 million at March 31, 2025 including the current portion of long-term debt and lease liabilities (working capital deficit of $1.7 million at December 31, 2024).
During Q1 2025, the Company spent $28 million on property, plant and equipment (including mineral properties), exploration and evaluation expenditures and advance payments for mineral properties related to its Niger uranium properties ($12 million in Q1 2024).
Throughout the year, the Company receives its share of management fees and sales commissions from the Turkish operations, which help fund the various corporate costs.
On January 31, 2025, Global Atomic closed a private placement for gross proceeds of $35.6 million at a price of $0.80 per Unit consisting of one common share and one common share warrant.
Completion of the Dasa Project will require additional financing, both from debt and equity or other sources. The Company's ability to advance the Dasa Project on its planned schedule will be dependent upon its ability to obtain the necessary financing. The Company's development schedule projects commissioning of the Dasa Project in H1 2026. Delays in obtaining the requisite funding to maintain this schedule will have a direct impact and delay commissioning of the Dasa Project. If additional financing is delayed, the development schedule would be extended to match the timing of such additional financing. The Company is pursuing opportunities to fund the required construction and start-up capital, and is considering project finance, sales contract prepayments, equity, and other sources of funding. Although the Company has been successful in the past in obtaining financing, there is no assurance that such financing will be available on a timely basis and under terms which are acceptable to the Company.
In managing its capital, the Company's objective is to ensure the Company is able to continue its operations and that it has sufficient ability to satisfy its capital obligations and ongoing operational expenses. The Company considers the components of shareholders' equity, as well as its cash and equivalents, notes receivable, credit facilities and longterm loan obligations as capital. Management adjusts the capital structure as necessary in order to support its business strategy. The Board of Directors does not establish quantitative return on capital criteria for management, but rather relies on the expertise of the Company's management team to sustain current operations and future development of the business. The Company is not subject to externally imposed capital requirements.
The Company's activities expose it to a variety of financial risks: credit risk, liquidity risk and market risk (including interest rate, foreign exchange rate, and commodity and equity price risk) which are listed in Note 23 of its audited consolidated financial statements for the year ended December 31, 2024.
The Company lists its related party transactions in Note 11 of its unaudited condensed interim consolidated financial statements for the three months ended March 31, 2025.
As of the date of this filing, the Company does not have any off-balance sheet arrangements that have, or are reasonably likely to have, a current or future effect on the results of operations or financial condition of the Company, including and without limitation, such considerations as liquidity and capital resources.
The Company prepares its consolidated financial statements in conformity with IFRS Accounting Standards. The preparation of the Company's consolidated financial statements requires management to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses. Material accounting policy information and critical accounting estimates and judgments are described in Notes 3 and 5 of the Company's audited consolidated financial statements for the year ended December 31, 2024.
The Company describes the effect of changes in material accounting policy information in Note 4 of its audited consolidated financial statements for the year ended December 31, 2024. Future changes in accounting policies are also covered in Note 4.
The Company's management, with the participation of its President and Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of Global Atomic's internal controls over financial reporting and disclosure controls and procedures as at March 31, 2025. In making this evaluation, management used the criteria set forth in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on that evaluation, the Company's President and Chief Executive Officer and Chief Financial Officer concluded that, as at March 31, 2025, the Company's internal controls over financial reporting and disclosure controls and procedures were effective to provide reasonable assurance that the information required to be disclosed by the Company in reports it files is recorded, processed, summarized and reported within the appropriate time periods. There was no change in the Company's internal controls over financial reporting that occurred during the three months ended March 31, 2025 that has materially affected, or is reasonably likely to materially affect, the Company's internal controls over financial reporting.
The Company's management, including the President and Chief Executive Officer and the Chief Financial Officer, does not expect that its internal controls over financial reporting and disclosure controls and procedures will prevent or detect all errors and frauds. A cost-effective system of internal controls, no matter how well conceived or operated, can provide only reasonable, not absolute, assurance that the objectives of the internal controls over financial reporting are achieved.
Mineral exploration, development and operation of mining properties involves several risks which experience, knowledge and careful evaluation may not be sufficient to overcome. Large capital expenditures are required in advance of anticipated revenues from operations. Many exploration programs do not result in the discovery of mineralization; moreover, mineralization discovered may not be of sufficient quantity or quality to be profitably mined. Unusual or unexpected formations, formation pressures, fires, power outages, labour disruptions, flooding, explosions, tailings impoundment failures, cave-ins, landslides and the inability to obtain adequate machinery, equipment or labour are some of the risks involved in the conduct of exploration programs and the operation of mines. The commercial viability of exploiting any mineral resources is also dependent on a number of factors including infrastructure and government regulations, in particular those respecting the environment, price, taxes and royalties.
Additional risks and uncertainties are discussed in greater detail in the Company's Annual Information Form and the Company's Management Discussion and Analysis for the year ended December 31, 2024, both available on https://www.sedarplus.ca.
As at May 13, 2025 the outstanding common shares, stock options and share purchase warrants are:
Common shares outstanding
308,091,073
Warrants outstanding
97,289,551
Options outstanding
6,500,000
Fully diluted shares outstanding
411,880,624
The Company's financial statements are the responsibility of the Company's management and have been approved by the board of directors. The consolidated financial statements were prepared by the Company's management in accordance with IFRS. The consolidated financial statements include certain amounts based on the use of estimates and assumptions. Management has established these amounts in a reasonable manner in order to ensure the financial statements are presented fairly in all material respects.
The scientific and technical disclosures in this Management's Discussion and Analysis have been extracted from the 2024 Feasibility Study, which was reviewed and approved by Dmitry Pertel, M.Sc., MAIG, John Edwards, B.Sc. Hons., FSAIMM, Andrew Pooley, B. Eng (Hons)., FSAIMM who are "qualified persons" under National Instrument 43-101 -Standards of Disclosure for Mineral Properties.
Except for statements of historical fact relating to the Company, certain information contained in this MD&A constitutes "forward-looking information" under Canadian securities legislation. Forward-looking information includes, but is not limited to, statements with respect to the potential of the Company's assets; the future prices of uranium or zinc; capital expenditure requirements; requirements for additional capital and other statements relating to the financial and business prospects of the Company. Generally, forward-looking information can be identified by the use of forward-looking terminology such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or statements that certain actions, events or results "may", "could", "would", "might" or "will be taken", "occur" or "be achieved". Forward-looking information is based on the reasonable assumptions, estimates, analysis and opinions of management made in light of its experience and its perception of trends, current conditions and expected developments, as well as other factors that management believes to be relevant and reasonable in the circumstances at the date that such statements are made, and are inherently subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of the Company to be materially different from those expressed or implied by such forward-looking information, including but not limited to risks related to: unexpected events and delays during permitting; timing and availability of external financing on acceptable terms and in light of the current status of global liquidity and credit availability; future prices of uranium or zinc; currency exchange rates; government regulation; failure of equipment or processes to operate as anticipated; risks inherent in manufacturing and processing operations, including strike by unionized personnel, environmental hazards or industrial accidents; and uncertain political and economic environments. Although management of the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking information, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place
undue reliance on forward-looking information. The Company does not undertake to update any forward-looking information, except in accordance with applicable securities laws.
May 13, 2025
"Stephen G. Roman" "Rein A. Lehari"
Stephen G. Roman Rein A. Lehari
Chairman, President & CEO Chief Financial Officer
Disclaimer
Global Atomic Corporation published this content on May 13, 2025, and is solely responsible for the information contained herein. Distributed via Public Technologies (PUBT), unedited and unaltered, on May 13, 2025 at 23:05 UTC.