Solaris Resources Inc.(SLSR) - 2025 Q2 - Quarterly Report

Condensed Consolidated Interim Financial Statements Condensed Consolidated Interim Statements of Financial Position Solaris Resources Inc.'s financial position as of June 30, 2025, shows a notable increase in total assets and a significant rise in total liabilities, resulting in a larger shareholders' deficit compared to December 31, 2024 Financial Position Summary | Metric | June 30, 2025 ($ thousands) | December 31, 2024 ($ thousands) | Change ($ thousands) | Change (%) | | :----------------------------- | :-------------------------- | :-------------------------- | :------------------- | :--------- | | Total Assets | 73,369 | 57,196 | 16,173 | 28.28% | | Total Liabilities | 102,082 | 66,483 | 35,599 | 53.55% | | Shareholders' Deficit | (28,713) | (9,287) | (19,426) | 209.17% | | Cash and cash equivalents | 47,047 | 31,738 | 15,309 | 48.24% | | Deferred revenue | 90,462 | – | 90,462 | N/A | | Loans and borrowings | – | 49,206 | (49,206) | -100.00% | Condensed Consolidated Interim Statements of Net Loss and Comprehensive Loss Solaris Resources Inc. reported a net loss of $3,854 thousand for the three months ended June 30, 2025, a significant improvement from the $17,643 thousand loss in the prior year period Net Loss and Comprehensive Loss Summary | Metric | 3 Months Ended June 30, 2025 ($ thousands) | 3 Months Ended June 30, 2024 ($ thousands) | Change ($ thousands) | Change (%) | 6 Months Ended June 30, 2025 ($ thousands) | 6 Months Ended June 30, 2024 ($ thousands) | Change ($ thousands) | Change (%) | | :------------------------------------ | :----------------------------------- | :----------------------------------- | :------------------- | :--------- | :----------------------------------- | :----------------------------------- | :------------------- | :--------- | | Gain on sale of royalty interest | (9,812) | – | (9,812) | N/A | (9,812) | – | (9,812) | N/A | | Exploration expenses | 8,850 | 14,384 | (5,534) | -38.47% | 21,167 | 24,577 | (3,410) | -13.87% | | General and administrative expenses | 5,528 | 2,482 | 3,046 | 122.72% | 8,459 | 4,628 | 3,831 | 82.78% | | Net loss | 3,854 | 17,643 | (13,789) | -78.16% | 19,942 | 30,395 | (10,453) | -34.39% | | Net loss per share (Basic and diluted)| 0.02 | 0.12 | (0.10) | -83.33% | 0.12 | 0.20 | (0.08) | -40.00% | Condensed Consolidated Interim Statements of Cash Flows Cash and cash equivalents increased significantly for both the three and six months ended June 30, 2025, primarily driven by a substantial positive cash flow from operations, largely due to deferred revenue recognition, which offset negative cash flows from financing activities related to loan repayment Cash Flow Summary | Metric | 3 Months Ended June 30, 2025 ($ thousands) | 3 Months Ended June 30, 2024 ($ thousands) | Change ($ thousands) | Change (%) | 6 Months Ended June 30, 2025 ($ thousands) | 6 Months Ended June 30, 2024 ($ thousands) | Change ($ thousands) | Change (%) | | :------------------------------------ | :----------------------------------- | :----------------------------------- | :------------------- | :--------- | :----------------------------------- | :----------------------------------- | :------------------- | :--------- | | Cash provided by (used in) Operations | 84,713 | (12,150) | 96,863 | 797.23% | 67,455 | (22,378) | 89,833 | 401.43% | | Cash provided by (used in) Financing | (51,915) | 37,536 | (89,451) | -238.31% | (51,672) | 37,489 | (89,161) | -237.85% | | Cash provided by (used in) Investing | (506) | 170 | (676) | -397.65% | (1,016) | 46 | (1,062) | -2308.70% | | Increase (decrease) in cash and cash equivalents | 32,805 | 25,363 | 7,442 | 29.34% | 15,309 | 15,271 | 36 | 0.24% | | Cash and cash equivalents, end of period | 47,047 | 54,136 | (7,089) | -13.10% | 47,047 | 54,136 | (7,089) | -13.10% | Condensed Consolidated Interim Statements of Changes in Equity The company's total equity shifted from a deficit of $9,286 thousand at December 31, 2024, to a larger deficit of $28,713 thousand by June 30, 2025, primarily due to a net loss and comprehensive loss of $22,213 thousand, partially offset by share issuances Changes in Equity Summary | Metric | December 31, 2024 ($ thousands) | June 30, 2025 ($ thousands) | Change ($ thousands) | Change (%) | | :------------------------------------ | :-------------------------- | :-------------------------- | :------------------- | :--------- | | Total equity | (9,286) | (28,713) | (19,427) | 209.20% | | Common shares (Amount) | 244,718 | 246,578 | 1,860 | 0.76% | | Deficit | (282,582) | (302,489) | (19,907) | 7.04% | | Net loss and comprehensive loss | N/A | (22,213) | (22,213) | N/A | Notes to the Condensed Consolidated Interim Financial Statements 1. Nature of Operations and Going Concern Solaris Resources Inc. is an exploration and development company focused on mineral property interests, primarily the Warintza project in Ecuador, operating on a going concern basis but facing material uncertainty due to its reliance on external financing and the absence of operating cash flow from a producing mine - Solaris Resources Inc. is engaged in the acquisition, exploration, and development of mineral property interests, with primary assets including Warintza (Ecuador), La Verde (Mexico), and Tamarugo (Chile) - The company's ability to continue as a going concern is dependent on successful execution of its business plan, meeting Warintza project milestones, and raising additional capital, as it does not generate operating cash flow from a producing mine and has incurred operating losses[10] - As of June 30, 2025, the company had $47,047 thousand in cash and cash equivalents, and secured a funding package with Royal Gold for $200,000 thousand on May 21, 2025, with the first tranche of $100,000 thousand received at closing[11][13] - Material uncertainty exists regarding the company's ability to continue as a going concern, as additional financing from the second tranche of the Royal Gold funding package is required to fund ongoing operations for the next twelve months[12] 2. Basis of Preparation These condensed consolidated interim financial statements are prepared in accordance with IAS 34, Interim Financial Reporting, and should be read in conjunction with the company's most recent annual audited financial statements for the year ended December 31, 2024, with consistent accounting policies, significant judgments, and key sources of estimation uncertainty - The condensed consolidated interim financial statements are prepared in accordance with International Financial Accounting Standard 34 ("IAS 34"), Interim Financial Reporting, and do not include all information required for annual financial statements[14] - These statements should be read in conjunction with the Company's most recent annual audited financial statements for the year ended December 31, 2024, with consistent accounting policies, significant judgments, and key sources of estimation uncertainty[15] 3. Material Accounting Policies New material accounting policies include the recognition of deferred revenue from streaming agreements and the accounting for the sale of royalty interests - New material accounting policies include deferred revenue related to gold streaming agreements and the sale of royalty interests[17][23] 3.a Deferred Revenue - Consideration received from streaming agreements is recognized as deferred revenue and amortized to revenue as the obligation to deliver gold is satisfied over the contract life[17][18] - Contracts with a significant financing component, where consideration is received in advance, are adjusted to reflect financing, with interest expense recognized in the consolidated statements of loss and comprehensive loss[19][20][21] 3.b Sale of Royalty Interest - Proceeds from the sale of a royalty interest are recorded as a reduction against the Exploration and Evaluation asset, and any excess after the asset value reaches $0 is recognized as a gain in the statement of net loss[23] 4. Use of Judgements and Estimates Management applies judgments and estimates in preparing financial statements, particularly in accounting for streaming arrangements, which involve assessing the contract type, significant financing components, and estimating future commodity deliveries, with these estimates subject to variability and potential impact on revenue recognition - Management makes judgments, estimates, and assumptions that affect the application of accounting policies and reported amounts, with actual results potentially differing from estimates[24] 4.a Accounting for Streaming Arrangements - Management determined that the Stream constitutes a contract for the future sale of commodities, settled by delivery, and is recorded as deferred revenue rather than a financial liability[25] - The contract was assessed to have a significant financing component, requiring estimates of commodity quantity and cash selling price to determine the implicit interest rate, which can impact the timing and amount of revenue recognized[25] 5. Prepaids and Other Prepaid expenses and other current assets decreased slightly from $842 thousand at December 31, 2024, to $784 thousand at June 30, 2025, primarily due to a decrease in prepaid expenses and the elimination of amounts due from a related party Prepaids and Other Summary | Item | June 30, 2025 ($ thousands) | December 31, 2024 ($ thousands) | Change ($ thousands) | Change (%) | | :-------------------------- | :-------------------------- | :-------------------------- | :------------------- | :--------- | | Prepaid expenses and deposits | 494 | 534 | (40) | -7.49% | | Supplies inventory | 120 | 143 | (23) | -16.08% | | Taxes recoverable | 115 | 101 | 14 | 13.86% | | Amounts receivable and other| 55 | 38 | 17 | 44.74% | | Due from a related party | – | 26 | (26) | -100.00% | | Total | 784 | 842 | (58) | -6.89% | 6. Exploration and Evaluation Assets The total value of exploration and evaluation assets slightly decreased from $20,179 thousand at December 31, 2024, to $19,991 thousand at June 30, 2025, primarily due to the Warintza property's carrying value being reduced to zero following a royalty sale Exploration and Evaluation Assets Summary | Asset | June 30, 2025 ($ thousands) | December 31, 2024 ($ thousands) | Change ($ thousands) | Change (%) | | :-------------------------- | :-------------------------- | :-------------------------- | :------------------- | :--------- | | La Verde (Mexico) | 19,741 | 19,741 | 0 | 0.00% | | Warintza (Ecuador) | – | 188 | (188) | -100.00% | | ENAMI Concessions (Ecuador) | 250 | 250 | 0 | 0.00% | | Total | 19,991 | 20,179 | (188) | -0.93% | 6.a La Verde - The La Verde project in Mexico is 60% owned by Solaris Resources Inc. and 40% by a subsidiary of Teck Resources Ltd., with Solaris acting as the operator[28] - La Verde is subject to a 0.5% net smelter royalty held by Minera CIMA, S.A. de C.V.[28] 6.b Warintza - Solaris owns a 100% interest in the Warintza project in Ecuador, which consists of nine mining concessions covering 26,774 hectares[29] - A 0.3% net smelter return royalty was issued to Royal Gold as part of the Royal Gold Financing Agreements, resulting in a $188 thousand reduction to the Warintza property's carrying value and a $9,812 thousand gain on the sale of royalty interest[30] 6.c ENAMI 1 Option - Solaris holds an option agreement to acquire up to a 100% interest in 10 new exploration concessions (approximately 40,000 hectares) from ENAMI EP, adjacent to the Warintza Project in Ecuador[31] - To exercise the option, the Company is required to incur $25,000 thousand in exploration expenditures and pay an exercise price determined by independent experts for each concession acquired[32] 6.d Tamarugo - Solaris owns a 100% interest in Tamarugo, a grass-roots copper porphyry target strategically located in northern Chile, covering approximately 7,600 hectares[33] 6.e Other Projects - Solaris has earn-in agreements on other projects, including the 4,200-hectare Capricho copper-molybdenum-gold property and the 4,400-hectare Paco Orco lead, zinc, and silver property in Peru[34] 7. Reclamation Provision The reclamation provision increased from $3,765 thousand at December 31, 2024, to $4,046 thousand at June 30, 2025, reflecting estimated costs for environmental restoration at Warintza, expected to be incurred in 2027, with restricted cash of $571 thousand held to collateralize environmental bonding requirements Reclamation Provision Summary | Item | June 30, 2025 ($ thousands) | December 31, 2024 ($ thousands) | Change ($ thousands) | Change (%) | | :-------------------------- | :-------------------------- | :-------------------------- | :------------------- | :--------- | | Balance, start of period | 3,765 | 1,529 | 2,236 | 146.24% | | Additions | 185 | 2,244 | (2,059) | -91.75% | | Accretion | 31 | 33 | (2) | -6.06% | | Settlement | (1) | (13) | 12 | -92.31% | | Change in estimate | 66 | (28) | 94 | -335.71% | | Balance, end of period | 4,046 | 3,765 | 281 | 7.46% | - Restricted cash of $571 thousand is held to collateralize guarantees issued to support environmental bonding requirements with respect to environmental disturbances at Warintza[36] 8. Property, Plant and Equipment The net book value of property, plant and equipment increased from $3,866 thousand at December 31, 2024, to $4,976 thousand at December 31, 2025, primarily driven by significant additions to construction in progress Property, Plant and Equipment Summary | Category | December 31, 2024 ($ thousands) | December 31, 2025 ($ thousands) | Change ($ thousands) | Change (%) | | :-------------------------- | :-------------------------- | :-------------------------- | :------------------- | :--------- | | Site infrastructure and equipment | 1,926 | 1,746 | (180) | -9.35% | | Construction in progress | 1,235 | 2,530 | 1,295 | 104.86% | | Warehouse & office equipment & furniture | 255 | 220 | (35) | -13.73% | | Right-of-use assets | 450 | 480 | 30 | 6.67% | | Total | 3,866 | 4,976 | 1,110 | 28.71% | 9. Warintza Project Financing Solaris secured a $200,000 thousand funding package with Royal Gold in May 2025, comprising a gold stream and a net smelter return royalty, which enabled the full repayment of the $60,000 thousand Senior Loan from OMF, significantly restructuring the project's debt - On May 21, 2025, Solaris entered into a $200,000 thousand funding package with Royal Gold for the Warintza project, consisting of a Stream and a Royalty[44] - The Royal Gold funding package provided the necessary capital to repay the $60,000 thousand Senior Loan facility from OMF[42] 9.a Senior Loan – OMF Fund IV SPV D LLC Senior Loan Summary | Item | June 30, 2025 ($ thousands) | December 31, 2024 ($ thousands) | Change ($ thousands) | Change (%) | | :-------------------------- | :-------------------------- | :-------------------------- | :------------------- | :--------- | | Balance, start of period | 49,206 | 29,363 | 19,843 | 67.58% | | Advances | 15,000 | 15,000 | 0 | 0.00% | | Loan and accrued interest repayment | (67,257) | – | (67,257) | N/A | | Balance, end of period | – | 49,206 | (49,206) | -100.00% | - The Senior Loan was fully repaid by June 30, 2025, with the interest for the three and six months ended June 30, 2025, having been accrued to the principal amount[41][42] - The Senior Loan was measured at amortized cost using an effective interest rate of 16.18% at June 30, 2025, an increase from 12.80% at December 31, 2024[41] 9.b Offtake Agreements - Under the terms of the offtake agreements, OMF will purchase the greater of 20% of the copper and molybdenum concentrates produced from the Warintza project or minimum specified tonnages (30,000 tonnes of copper and 1,500 tonnes of molybdenum) in each contract year[42] - The offtake agreements will expire 20 years after the achievement of commercial production, with potential extensions if commercial production is not achieved by December 31, 2027, or December 31, 2032[43] 9.c Funding Package with Royal Gold - The Royal Gold funding package provides $200,000 thousand in three instalments: $100,000 thousand upon closing (received), $50,000 thousand after Pre-Feasibility Study (PFS) publication and Environmental Impact Assessment (EIA) approval, and $50,000 thousand on the first anniversary of closing[45][50] - Under the Stream, Royal Gold will receive gold deliveries equivalent to 20 ounces per 1 million pounds of copper produced, with a purchase price of 20% of spot price until 90,000 ounces have been delivered, and then 60% of spot price thereafter[45] - The Royalty grants Royal Gold a 0.3% net smelter return royalty on all metal production from a defined area, increasing annually by 0.0375% up to a maximum of 0.6% until the earlier of the first delivery of gold under the Stream or eight years following the closing date[46] - The Company's obligations under the Stream and Royalty are secured by various British Columbia and Ecuador-law security agreements and guarantees, including an all-asset general security agreement and share pledges[47][48] Deferred Revenue (related to Royal Gold Stream) - The $100,000 thousand Stream Upfront Payment received from Royal Gold is recorded as deferred revenue, which includes a significant financing component[49][51] - The deferred revenue balance is accreted by recognizing interest expense at an effective rate of 4.6%, determined based on the expected deliveries against the deferred revenue[51] 10. Share Capital The number of common shares issued and fully paid increased to 165,759,638 by June 30, 2025, with share-based compensation expense for the six months ended June 30, 2025, increasing to $2,080 thousand - The number of issued and fully paid common shares increased to 165,759,638 as of June 30, 2025, from 163,234,932 at December 31, 2024[52] Share-based Compensation Expense | Period | 2025 ($ thousands) | 2024 ($ thousands) | Change ($ thousands) | Change (%) | | :-------------------------- | :-------------------------- | :-------------------------- | :------------------- | :--------- | | Three months ended June 30 | 1,008 | 665 | 343 | 51.58% | | Six months ended June 30 | 2,080 | 1,494 | 586 | 39.22% | 10.a Common Shares - The Company has an unlimited number of authorized common shares with no par value, with 165,759,638 shares issued and fully paid as of June 30, 2025[52] 10.b Share Placements - On January 15, 2025, the Company issued 83,333 common shares at a price of C$4.20, generating gross proceeds of $244 thousand from a private placement[52] 10.c Share Purchase Options Share Purchase Options Summary | Item | 2025 | 2024 | Change | | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Balance, start of period | 14,165,000 | 10,556,688 | 3,608,312 | | Granted | – | 900,000 | (900,000) | | Exercised | (2,441,373) | (288,107) | (2,153,266) | | Forfeited/expired | (818,627) | (358,581) | (460,046) | | Balance, end of period | 10,905,000 | 10,810,000 | 95,000 | - The weighted average exercise price of options exercised during the six months ended June 30, 2025, was C$0.80, while for forfeited options it was C$5.11[52] Outstanding and Exercisable Options | Exercise price (C$) | Number of outstanding options | Weighted average remaining contractual life (years) | Number of exercisable options | Weighted average remaining contractual life (years) | | :-------------------------- | :-------------------------- | :-------------------------------------------------- | :-------------------------- | :-------------------------------------------------- | | 4.61 | 10,905,000 | 2.98 | 4,925,000 | 1.81 | 10.d Restricted Share Units - As of June 30, 2025, there were 260,836 Restricted Share Units (RSUs) and performance-based RSUs (pRSUs) outstanding, representing 26,085 Solaris shares issuable[56] - No RSUs were redeemed under the Company's RSU plan during the six months ended June 30, 2025, or 2024[56] 11. Exploration Expenditures Total exploration expenditures decreased from $24,577 thousand for the six months ended June 30, 2024, to $21,167 thousand for the same period in 2025, primarily driven by a significant decrease in drilling and drilling-related costs, particularly in Ecuador Exploration Expenditures by Activity | Activity | 3 Months Ended June 30, 2025 ($ thousands) | 3 Months Ended June 30, 2024 ($ thousands) | Change ($ thousands) | Change (%) | 6 Months Ended June 30, 2025 ($ thousands) | 6 Months Ended June 30, 2024 ($ thousands) | Change ($ thousands) | Change (%) | | :------------------------------------ | :----------------------------------- | :----------------------------------- | :------------------- | :--------- | :----------------------------------- | :----------------------------------- | :------------------- | :--------- | | Salaries, studies, geological consultants and support, and travel | 3,419 | 4,203 | (784) | -18.65% | 9,003 | 7,509 | 1,494 | 19.89% | | Site preparation, supplies, field and general | 2,203 | 3,353 | (1,150) | -34.29% | 4,567 | 5,641 | (1,074) | -19.04% | | Drilling and drilling related costs | 69 | 3,697 | (3,628) | -98.13% | 1,041 | 5,198 | (4,157) | -79.98% | | Community relations, environmental and permitting | 2,652 | 1,814 | 838 | 46.20% | 4,824 | 3,748 | 1,076 | 28.71% | | Total | 8,850 | 14,384 | (5,534) | -38.47% | 21,167 | 24,577 | (3,410) | -13.87% | Exploration Expenditures by Jurisdiction | Jurisdiction | 2025 ($ thousands) | 2024 ($ thousands) | Change ($ thousands) | Change (%) | | :-------------------------- | :-------------------------- | :-------------------------- | :------------------- | :--------- | | Ecuador | 17,974 | 23,728 | (5,754) | -24.25% | | Peru and other | 3,061 | 717 | 2,344 | 326.92% | | Total | 21,167 | 24,577 | (3,410) | -13.87% | 12. General and Administrative Expenditures General and administrative expenditures significantly increased for both the three and six months ended June 30, 2025, primarily driven by a substantial increase in professional fees and share-based compensation General and Administrative Expenditures Summary | Item | 3 Months Ended June 30, 2025 ($ thousands) | 3 Months Ended June 30, 2024 ($ thousands) | Change ($ thousands) | Change (%) | 6 Months Ended June 30, 2025 ($ thousands) | 6 Months Ended June 30, 2024 ($ thousands) | Change ($ thousands) | Change (%) | | :-------------------------- | :----------------------------------- | :----------------------------------- | :------------------- | :--------- | :----------------------------------- | :----------------------------------- | :------------------- | :--------- | | Share-based compensation | 1,009 | 665 | 344 | 51.73% | 2,079 | 1,494 | 585 | 39.16% | | Professional fees | 3,708 | 834 | 2,874 | 344.60% | 4,014 | 1,191 | 2,823 | 237.03% | | Total | 5,528 | 2,482 | 3,046 | 122.72% | 8,459 | 4,628 | 3,831 | 82.78% | 13. Segmented Information The company operates as a single operating segment, focused on the exploration of mineral properties, with its non-current assets primarily located in Mexico ($19,749 thousand) and Ecuador ($5,728 thousand) as of June 30, 2025 - The Company has one operating segment: the exploration of mineral properties[61] Non-Current Assets by Jurisdiction | Jurisdiction | June 30, 2025 ($ thousands) | December 31, 2024 ($ thousands) | Change ($ thousands) | Change (%) | | :-------------------------- | :-------------------------- | :-------------------------- | :------------------- | :--------- | | Mexico | 19,749 | 19,750 | (1) | -0.01% | | Ecuador | 5,728 | 4,774 | 954 | 19.98% | | Chile | 7 | 7 | 0 | 0.00% | | Peru | 54 | 79 | (25) | -31.65% | | Canada | – | 6 | (6) | -100.00% | | Total | 25,538 | 24,616 | 922 | 3.75% | 14. Financial Instrument Risk Exposure and Risk Management The company is exposed to various financial instrument risks, including credit risk, liquidity risk, and foreign currency risk, with the Board of Directors responsible for approving and monitoring the risk management process - The Company is exposed to various financial instrument related risks, including credit risk, liquidity risk, and foreign currency risk, with the Board of Directors approving and monitoring the risk management process[62] 14.a Credit Risk - Credit risk primarily arises from the Company's cash and cash equivalents and amounts receivable, limited by maintaining cash with high-credit quality financial institutions[63] - The maximum exposure to credit risk as of June 30, 2025, is $47,788 thousand, representing the carrying value of these financial assets[63] 14.b Liquidity Risk - The Company manages liquidity risk by ensuring there is sufficient capital to meet short-term business requirements, taking into account its holdings of cash[65] Contractual Maturities of Financial Liabilities | Item | < 1 Year ($ thousands) | 1-3 Years ($ thousands) | 4-5 Years ($ thousands) | > 5 Years ($ thousands) | Total ($ thousands) | | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Accounts payable and accrued liabilities | 6,833 | – | – | – | 6,833 | | Lease liabilities | 111 | 382 | – | – | 493 | | Other long-term liabilities | – | – | – | 248 | 248 | | Exploration expenses and other | 920 | 1,058 | – | – | 1,978 | | Total | 7,864 | 1,440 | – | 248 | 9,552 | 14.c Foreign Currency Risk - The Company is exposed to currency risk on transactions and balances in currencies other than its functional currency, the Canadian dollar, particularly from US dollar denominated assets and liabilities[67][68] - For the six months ended June 30, 2025, a 5% change in the US dollar to Canadian dollar currency exchange rate would result in a $1,562 thousand impact on the Company's net gain[68] 15. Fair Value Measurements The carrying values of cash and cash equivalents, amounts receivable, due from related parties, restricted cash, and accounts payable and accrued liabilities approximate their fair value due to their short terms to maturity, with no transfers between fair value levels in the periods presented - The carrying values of short-term financial assets and liabilities, including cash and cash equivalents, amounts receivable, restricted cash, and accounts payable, approximate their fair value due to their short terms to maturity[70] - There were no transfers between fair value levels in the periods presented[70] 16. Related Party Transactions Related party transactions include compensation for key management personnel and a terminated arrangement for shared administrative services, with key management compensation decreasing for the six months ended June 30, 2025, and charges from the shared services arrangement ceasing after its termination on January 1, 2025 - Related party transactions include compensation for key management personnel and charges from a shared administrative services arrangement, which was terminated on January 1, 2025[72][74] Compensation of Key Management Personnel Key Management Personnel Compensation Summary | Item | 3 Months Ended June 30, 2025 ($ thousands) | 3 Months Ended June 30, 2024 ($ thousands) | Change ($ thousands) | Change (%) | 6 Months Ended June 30, 2025 ($ thousands) | 6 Months Ended June 30, 2024 ($ thousands) | Change ($ thousands) | Change (%) | | :-------------------------- | :----------------------------------- | :----------------------------------- | :------------------- | :--------- | :----------------------------------- | :----------------------------------- | :------------------- | :--------- | | Share-based compensation | 458 | 522 | (64) | -12.26% | 941 | 1,177 | (236) | -20.05% | | Salaries and benefits | 329 | 273 | 56 | 20.51% | 642 | 496 | 146 | 29.44% | | Professional fees | – | 91 | (91) | -100.00% | – | 132 | (132) | -100.00% | | Total | 787 | 886 | (99) | -11.17% | 1,583 | 1,805 | (222) | -12.30% | Related Party Arrangement - The arrangement to share office space, equipment, personnel, and administrative services with other companies related by virtue of common directors and management was terminated on January 1, 2025[74] Related Party Arrangement Charges | Item | 3 Months Ended June 30, 2025 ($ thousands) | 3 Months Ended June 30, 2024 ($ thousands) | Change ($ thousands) | Change (%) | 6 Months Ended June 30, 2025 ($ thousands) | 6 Months Ended June 30, 2024 ($ thousands) | Change ($ thousands) | Change (%) | | :-------------------------- | :----------------------------------- | :----------------------------------- | :------------------- | :--------- | :----------------------------------- | :----------------------------------- | :------------------- | :--------- | | Salaries and benefits | – | 960 | (960) | -100.00% | – | 1,327 | (1,327) | -100.00% | | Office and other | – | 119 | (119) | -100.00% | 104 | 235 | (131) | -55.74% | | Total | – | 1,136 | (1,136) | -100.00% | 104 | 1,624 | (1,520) | -93.59% | 17. Supplemental Cash Flow Information Non-cash items for the six months ended June 30, 2025, included $126 thousand for right-of-use assets acquired, and accrued interest expense of $2,367 thousand was paid on May 21, 2025, concurrently with the repayment of the senior loan facility Supplemental Cash Flow Information Summary | Item | 2025 ($ thousands) | 2024 ($ thousands) | Change ($ thousands) | Change (%) | | :-------------------------- | :-------------------------- | :-------------------------- | :------------------- | :--------- | | Accrued share issuance and finance costs | – | 182 | (182) | -100.00% | | Accrued interest income | – | 25 | (25) | -100.00% | | Interest expense accrued to loans and borrowings | – | 2,024 | (2,024) | -100.00% | | Right of use asset acquired | 126 | 248 | (122) | -49.19% | - Accrued interest expense of $2,367 thousand was paid on May 21, 2025, along with the repayment of the senior loan facility[77]