Europa Metals' loss widens on higher exploration costs

Europa Metals on Tuesday reported a deepened annual loss due to higher exploration costs, though the company said that it had enjoyed a successful drilling programme at its Toral zinc project in North West Spain.

The lead-zinc explorer booked a loss before tax of $2.4m for the year ended 30 June, compared to a loss of $1.9m in the prior year, as exploration expenditure increased by 236% to $1.4m.

Revenue remained minimal, rising from $9,000 to $42,000.

The company finished the year with cash and cash equivalents of $1.1m, compared with $1.3m at the same point 12 months earlier, after the company said it "regrettably" had to raise funds at a sizeable discount to the prevailing market share price towards the end of March due to poor equity market conditions for mining companies.

However, the funds raised allowed the company to launch a diamond drilling campaign into the centre of the Toral Project.

Subsequently, the AIM traded company is now targeting an indicated resource estimate in the fourth quarter and said the upcoming results of ongoing metallurgical testwork will help the firm make an initial determination on potential products from the project, which could in turn be used in negotiations with potential third-party funders and buyers.

Meanwhile, exploration is set to continue outside the current resource area to identify any significant presence of copper in the area following detection of the metal during previous drilling activity.

Europa Metals shares were up 13.47% at 0.03p at 1531 BST.