Home Pan Africa Shuka Minerals Secures Fresh Funding to Complete Leopard Exploration Acquisition Amid Rising...

Shuka Minerals Secures Fresh Funding to Complete Leopard Exploration Acquisition Amid Rising Losses and Operational Challenges

7
Edenville International Tanzania Ltd.

(3 Minutes Read)

Africa-focused mining company Shuka Minerals PLC has announced the securing of a new loan facility aimed at finalising its acquisition of Leopard Exploration & Mining Ltd, even as it posted widened losses and faced continued operational setbacks across its asset base.

The dual-listed mining developer and operator reported a pretax loss of £2.0 million for the financial year ending 2024, an increase from £1.7 million in 2023. The company attributed the deeper losses primarily to a significant drop in revenue, which plummeted to just £2,305 compared to £194,346 the previous year. This drastic decline is largely linked to production difficulties at the Rukwa coal mine in Tanzania, which has been under care and maintenance throughout the reporting period.

In addition to declining revenues, administrative expenses surged by 26%, climbing from £1.4 million to £1.8 million, reflecting costs associated with maintaining current operations and executing its strategic realignment, particularly around its Zambian growth initiatives.

One of the most pressing challenges continues to be the underperformance of the Rukwa coal operation, managed by Shuka’s subsidiary Edenville International Tanzania Ltd. With the mine on limited activity, it has been unable to contribute meaningfully to the company’s top line. However, Shuka has recently undertaken a resource reassessment at Rukwa, which has offered renewed optimism. In response, it has allocated USD150,000 in restart capital expenditure, targeting a return to production by Q3 2025, contingent on favourable joint venture outcomes currently under discussion.

Despite the financial strain, Shuka remains committed to its broader expansion plans. The company confirmed it has secured a new £1.5 million unsecured, non-dilutive loan, aimed at completing its acquisition of Leopard Exploration & Mining Ltd, a transaction deemed critical to its entry into Zambia’s mining sector. The outstanding amount required to close the deal is USD1.35 million.

This latest loan builds upon earlier funding arrangements, including a £500,000 interest-free loan from Gathoni Muchai Investments, agreed in December 2024, and the extension of a £2 million convertible loan note with AUO Investments (Dubai). The maturity date of the AUO note has now been extended by 12 months to March 2026, with repayment postponed until March 2027.

Read Also;

https://trendsnafrica.com/bhp-eyes-south-africas-mining-sector-for-investment/

Management highlighted that both the Leopard acquisition and involvement in the Kabwe project are “company-changing milestones,” expected to redefine Shuka’s role in the Southern and Eastern African mining landscape. These projects are central to the company’s long-term strategic vision of becoming a significant regional player. In market response, Shuka Minerals’ shares rose by 1.1% to 5.16 pence on the London Stock Exchange, while remaining unchanged at ZAR1.37 on the Johannesburg Stock Exchange by close of trading Monday.